Fuel Intensity, Access to Finance and Profitability: Firm-Level Evidence from China

Lingbing Feng, Tong Fu and Ali Kutan

Emerging Markets Finance and Trade, 2018, vol. 54, issue 13, 3117-3130

Abstract: Sustainability and energy economics together as a field has rapidly developed in recent years. However, it is still limited of the literature regarding the effect of energy on firm performance. This article fills the gap by providing empirical evidence from China on the fuel intensity-performance link at the firm level. Our findings are summarized as follows: (i) firms’ fuel intensity significantly constrains the firms’ profitability and the constraint effect is significantly greater for firms with no access to finance; (ii) an increase in fuel intensity reduces profitability by intensifying the financial constraint effect; and (iii) financial access moderates the constraint effect of fuel intensity on firm’s performance. The policy implications of the findings are discussed.

Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:mes:emfitr:v:54:y:2018:i:13:p:3117-3130

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DOI: 10.1080/1540496X.2017.1403317

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