In doing so the second meeting builds on the first, because government policy making can only be analysed with a deep understanding of firms' behaviour. For example, if firms' investment is discouraged by environmental policy, governments may have an incentive to weaken their environmental policy in order to reduce capital flight or to stimulate foreign firms to locate within their borders (ecological dumping). In this case there may be gains from environmental policy co-ordination. The meeting will explore those issues, and examine government policy making under different political constitutions. Furthermore, both meetings will assess under which circumstances social welfare increases and equity and sustainable growth are enhanced.