Abstract
We examine determinants of ISO 14001 adoption by Japanese municipalities, which potentially play an important role in the diffusion of ISO 14001 adoption in Japan as role models. We employ a panel data set of 349 Japanese municipalities during 1998-2003 and fixed-effects logit model. We find the following implications from our empirical analysis. First, we find an implication of spillover effects of ISO 14001 adoption between local governments. The higher that the ratio of municipalities adopting ISO 14001 to all municipalities in the same prefecture was, the more likely a municipality was to adopt it. Second, we find that new mayors were generally less active in adopting ISO 14001 than incumbent mayors were, although a few of them pledged to adopt ISO 14001 in their election and then implemented their campaign promise. There were other noteworthy results. We find that municipalities with higher budget deficit are more likely to adopt ISO14001 to improve their efficiency in environmental issues.
