The Role of Environmental Practices and Innovation in Total Factor Productivity Convergence – Evidence from Small and Medium-sized Manufacturing Enterprises in Vietnam

Thanh Tam Nguyen-Huu, Khac Minh Huy Nguyen and Quoc Tran-Nam

Revue d'économie politique, 2022, vol. 132, issue 3, 453-489

Abstract: This research investigates the nexus between environmental compliance, innovation, and Total Factor Productivity convergence. We use two measures of environmental practices: the firm environmental standard certification and environmental treatment. As for innovation, it has three increasing-levels: no innovation, product or process innovation, and both types of innovation. Using a sample of Vietnamese small- and medium-sized manufacturing enterprises from 2007 to 2015, the environmental practices are not correlated with total factor productivity. By contrast, there is a strong correlation between innovation and environmental treatment. Factors contributing to the firm productivity growth rate, and consequently the speed of convergence, are innovation, firm size, and legal form.

Keywords: TFP; growth rate; β; convergence; Environmental practices (search for similar items in EconPapers)
Date: 2022
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