Imported carbon emissions: evidence from French manufacturing companies

Damien Dussaux, Francesco Vona and Antoine Dechezleprêtre

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper analyzes imported carbon emission at the firm level. To do so, we combine information on emissions, imports, imported emissions and energy prices for French manufacturing firms between 1997 and 2014. We document a significant increase of the carbon emissions embedded in imports of French manufacturing companies over the period 1997 to 2014 that is attributable mainly to a shift towards more carbon-intensive products and countries. We then estimate the impact of imported emissions on domestic emissions and emission intensity using a shift-share instrumental variable strategy based on third countries supply shocks. We do not find compelling evidence of an impact of carbon imports on total emissions, but emission efficiency improves significantly in companies offshoring emissions abroad. A 10% increase in carbon offshoring causes a 4% decline in emission intensity. In addition, we find that the elasticity of domestic emission intensity to imported emissions is stronger in energy-intensive sectors, on high-productivity companies and among exporters. Reassuringly, the relationship between imported emissions and emission intensity does not seem to be driven by a pollution haven motive.

JEL-codes: F14 F18 Q56 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2023-05-01
New Economics Papers: this item is included in nep-ene, nep-env, nep-eur and nep-int
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Citations: View citations in EconPapers (4)

Published in Canadian Journal of Economics, 1, May, 2023, 56(2), pp. 593 - 621. ISSN: 0008-4085

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http://eprints.lse.ac.uk/118751/ Open access version. (application/pdf)

Related works:
Journal Article: Imported carbon emissions: Evidence from French manufacturing companies (2023)
Working Paper: Carbon Offshoring: Evidence from French Manufacturing Companies (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:118751

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