The Transmission Effect Of Environmental Regulations On International Competitiveness Of Enterprises

According to traditional notion, there is an inherent dilemma between economic activity and environment protection. On the one hand, strict environmental regulation is good for human's home protecting, on the other hand, there are private costs that are inevitably incurred for an enterprise in order to abate pollution and reduce environmental damage. Which in turn result in higher prices and consequently a loss of competitiveness. Entrepreneurs tend to see the environment as a threat to their activity, in so far as it imposes restrictions, limiting their economic activities, and imposing additional costs which lower their competitiveness. However, according to Michael E. Porter, it is not sensible for firms to oppose the raising of environmental standards or the introduction of environmental regulations. Because there are economic incentives associated with the introduction of environmental regulations that encourage a process of restructuring and innovation within firms. This inevitably has positive effects on the productivity and efficiency with which resources are used and compensates for the initial increase in costs, so that regulation end up making firms more competitive and not less. Appropriately dealing with the relationship between environmental regulation and international competitiveness, not only there are important implications on our firms'competitiveness in global economy, but also there are positive significances to realize the sustainable development of economy and society.In the dissertation, firstly, based on the challenges to and limitations to conventional theory about the relationship between environmental regulation and firms competitiveness, analyzes the literatures both home and abroad which are about the relationship between environmental regulation and the competitiveness of enterprises comprehensively. And then uses the optimal control model of environmental pollution on the environment to describe the mechanism of environmental regulation. On this basis, the paper analyzes the transmission effect of environmental regulation on the international competitiveness of enterprise from both positive and negative comprehensively. On the one hand, the existence of environmental regulations will increase business costs and increase the difficulty of business management so that enterprises have lost their ascendency. On the other hand, environmental regulations will help to increase business R & D efforts, to save production costs, to fulfill their social responsibilities, to establish good corporate image, so as to enhance the competitiveness of enterprises in the international market. So we can see the way that firms complying with environmental question is a primary factor to firms'international competitiveness, and environmental bring firms a new competitive opportunity rather than an economic burden. Environmental regulation not only urge the firms to protect the environment and enhance the resource productivity, but also firms'better environmental performance, as a strategic asset, provides a basis for firms obtaining continuous competitive advantage. Then, using a number of cases to verify the above conclusions, and finally to table a number of strategies.It is clear that environmental regulations will help to improve the enterprises'international competitiveness. To achieve this goal, firms must regard environmental regulation as opportunity rather than restrict, and deal with environmental question through innovation. On the other hand, government must lay a set of measures, which encourage firms to guard against to environmental question rather than counter environmental regulation.