Global firms and emissions: Investigating the dual channels of emissions abatement

Ohyun Kwon, Hao Zhao and Min Qiang Zhao
Authors registered in the RePEc Author Service: Min Qiang (Kent) Zhao

Journal of Environmental Economics and Management, 2023, vol. 118, issue C

Abstract: This paper finds that both importing and exporting reduce firm-level emission intensities. We develop a theoretical model in which firms jointly determine the extent of abatement investment as well as whether or not to import intermediate inputs and export final goods. The model demonstrates a complementarity between trading decisions and abatement investment such that trading firms invest more in abatement technology and feature lower emission intensities. Using Chinese firm-level data, we estimate a theory-based regression model with instrument variables to account for the endogeneity issue associated with firms’ trading statuses. Our regression results show that both importing and exporting reduce firm-level emission intensities by over 15 percent.

Keywords: International trade; Emissions; China (search for similar items in EconPapers)
JEL-codes: D22 F18 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:118:y:2023:i:c:s0095069622001255

DOI: 10.1016/j.jeem.2022.102772

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