The Porter hypothesis asserts that a stricter environmental
regulation stimulates firms to conduct innovation and increase their profit.
This paper uses a theoretical framework to examine the Porter hypothesis. We
conclude that although a stricter environmental regulation can increase profit,
it does not stimulate innovation in a firm.
Cite this paper
M. Chang, "Environmental Regulation, Technology Innovation, and Profit: A Perspective of Production Cost Function," Theoretical Economics Letters
, Vol. 3 No. 6, 2013, pp. 297-301. doi: 10.4236/tel.2013.36050
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