Impact of bad outputs and environmental regulation on efficiency of Indian leather firms: a directional distance function approach

Aparajita Singh and Haripriya Gundimeda

Journal of Environmental Planning and Management, 2021, vol. 64, issue 8, 1331-1351

Abstract: This paper measures the environmental efficiency of the grossly polluting Indian leather industry which faces stringent environmental regulations. The environmental efficiency measure accounts for associated bad outputs (total suspended solids and chromium) with the good output (leather products) of firms and hence, provides an important benchmark for improving environmental performance. Drawing data from fieldwork in the Kanpur industry of India, the study estimates efficiency using the directional distance function approach under three directional vectors. The results reveal that the efficiency of firms is underestimated when bad outputs are omitted in the production technology. There is significant potential to increase leather production and reduce pollutants across firms. The study confirms that regulation improves the environmental efficiency of leather firms. However, regulation imposes an opportunity cost on firms of an average 3% loss in expanding leather output and reducing inputs. The study recommends mandating the use of cleaner technology and market-based instruments to improve environmental efficiency.

Date: 2021
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/09640568.2020.1822307 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:jenpmg:v:64:y:2021:i:8:p:1331-1351

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CJEP20

DOI: 10.1080/09640568.2020.1822307

Access Statistics for this article

Journal of Environmental Planning and Management is currently edited by Dr Neil Powe, Dr Ken Willis and George Bill Page

More articles in Journal of Environmental Planning and Management from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().