A) An approach which results in the degradation of environmental Standards so that a State gains competitive advantage in the world economic arena
B) An approach which asks for the introduction of new environmental standards
C) An approach which asks for the increase of funds towards new environmental standards
D) An approach which suggests that States around the world should co-ordinate in improving their domestic environmental laws
Correct Answer: A
Solution :
[a] The "race-to-the-bottom" hypothesis was initially formulated in the context of local competition for investments and jobs within federal states, where the decentralized environmental responsibilities gave each state independence in setting their environmental standards in line with their priorities. Most critics argue that increased competition for trade and foreign direct investment could lead to lowering of environmental standards and regulations. Furthermore, governments which attempt to maintain high standards will see their efforts undermined by the existance of less stringent regulations elsewhere. This will then lead to an overall lowering of environmental standards internationally.
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