An analysis of relationship between environmental regulations and firm performance with moderating effects of product market competition: Empirical evidence from Pakistan
By Sohail Ahmad Javeed, Rashid Latief, Lin Lefen. 2020
132 citations recorded by the source corpus.
Abstract Many countries are facing environmental issues that affect the natural climate and life of human beings, therefore, governments have developed the strategies and regulations to control the industrial negative effects on the environment which is called environmental regulations (ER). To extend the porter hypothesis, we examined the moderating effect of product market competition (PMC) to find the circumstances that affect the association between ER and FP. We have divided PMC into high and low product market competition (HPMC and LPMC) by following the Herfindahl-Hirschman Index (HHI). The empirical investigation of this study demonstrates the following outcomes: ER indicates a statistically significant and positive relationship with FP. Furthermore, HPMC has great importance for FP, while LPMC has shown a negative relationship with FP. Besides, we tested the moderating effects of HPMC and LPMC on the association between ER and FP. The moderating effects of HPMC have significant and positive effects on the association between ER and FP. On the other side, the moderating effects of LPMC have significant and negative effects on the association between ER and FP. Moreover, this study promotes the importance of ER and PMC for firms. This study is beneficial for owners, investors, policymakers, and governments to form comprehensive and viable ER for reducing environmental negative effects.
Subfields: Economics and Econometrics, Marketing, Strategy and Management
View Paper: https://www.semanticscholar.org/paper/552821af4373c05a276056c0fdef40c530830cc8
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Citations in the corpus
- The Effects of Market Competition, Capital Structure, and CEO Duality on Firm Performance: A Mediation Analysis by Incorporating the GMM Model Technique (2020, methodology): “Previous studies [73,87] have stated that HHI is the best measurement of market competition among the other available measurements.”
- Economic policy uncertainty, stakeholder engagement, and environmental, social, and governance practices: The moderating effect of competition (2020, background): “Also, environmental responsibility increases a firm's performance measured by profitability (Javeed et al., 2020; Lee, Cin, & Lee, 2016).”