Power shortage and firm performance: Evidence from a Chinese city power shortage index

Dongmei Guo, Qin Li, Peng Liu, Xunpeng Shi and Jian Yu

Energy Economics, 2023, vol. 119, issue C

Abstract: Extreme climate events and renewable energy development challenge the reliability of the power supply, which is an important guarantee for high-quality economic development and the production and operation of firms. In this paper, we analyzed the relationship between power shortage and firm productivity by developing a city-level power shortage index in China using the text analysis method. The results indicate that power shortage reduces the probability, quantity, and quality of R&D investment and has a negative impact on the total factor productivity (TFP) of firms. However, it has a smaller negative impact on the TFP of large- and medium-sized firms, export-oriented firms, and state-owned firms than others. Our results are robust to alternative measures of power shortage.

Keywords: Power shortage; Total factor productivity; Instrumental variable; China (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:119:y:2023:i:c:s0140988323000919

DOI: 10.1016/j.eneco.2023.106593

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