DETERMINANTS OF THE FIRM'S POLLUTION ABATEMENT EXPENDITURE DECISSION IN ROMANIA

Using a panel dataset, containing information from Romanian industrial sector, this paper analyse the determinants of the pollution abatement expenditure, in the context of transition economy. We consider information related to the pollution abatement expenditure at plant level, plant - specific characteristics, state and local regulatory stringency, market incentives and community characteristics. Our results stress that the population's potential for collective action in the environmental area is not significant. Also, there is not evidence that the economic incentives to adopt an environmental behavior raise the level of plant Pollution Abatement Expenditure. The demands from regulators and plant characteristics are the most influential determinants in the adoption of the decision to raise the level of plant Pollution Abatement Expenditure.