Click here for search results
Capital markets responses to environmental performance in developing countries, Volume 1
Author:Dasgupta, Susmita; Laplante, Benoit; Mamingi, Nlandu; Country:Switzerland; Mexico; Philippines; Argentina;
Date Stored:1998/04/01Document Date:1998/04/30
Document Type:Policy Research Working PaperSubTopics:Environmental Economics & Policies; Small Scale Enterprise; Water and Industry; Agricultural Research; Microfinance; Small and Medium Size Enterprises; Private Participation in Infrastructure
Language:EnglishMajor Sector:Finance
Region:Europe and Central Asia; East Asia and Pacific; Latin America & CaribbeanReport Number:WPS1909
Sub Sectors:Capital Markets DevelopmentCollection Title:Policy, Research working paper ; no. WPS 1909
Volume No:1  

Summary: Firms in developing countries are often said to have no incentives to invest in pollution control because they typically face weak monitoring and enforcement of environmental regulations. But the inability of formal institutions to control pollution through fines and penalties may not be as serious an impediment to pollution control as is generally argued, contend the authors. Capital markets may react negatively to news of adverse environmental incidents (such as spills or violations of permits) as well as positively to the announcement that a firm is using cleaner technologies. The authors assess whether capital markets in Argentina, Chile, Mexico, and the Philippines react to the announcement of firm-specific environmental news. They show that: I) Capital markets react positively ( the firms' market value increases) to the announcement of rewards and explicit recognition of superior environmental performance. ii) They react negatively (the firms' value decreases) to citizens' complaints. Environmental regulators in developing countries could 1) harness market forces by introducing structured programs to release firm-specific information about environmental performance, and 2) empower communities and stakeholders through environmental education programs.

Official Documents
Official, scanned versions of documents (may include signatures, etc.)
File TypeDescriptionFile Size (mb)
PDF 40 pagesOfficial version*2.8 (approx.)
TextText version**
How To Order
Light-Weight Documents
Lighter (less MB) documents which may or may not be the final, official version
File TypeDescriptionFile Size (mb)
PDF 42 pagesWPS19090.16

* The official version is derived from scanning the final, paper copy of the document and is the official,
archived version including all signatures, charts, etc.
** The text version is the OCR text of the final scanned version and is not an accurate representation of the final text.
It is provided solely to benefit users with slow connectivity.

Permanent URL for this page: