Energy Efficiency and Mitigation of Greenhouse Gas Emissions in Mexico's Manufacturing Sector

Anna D. Mata and Héctor M. Núñez

No 2025-10, Working Papers from Banco de México

Abstract: This study examines the energy efficiency and environmental performance of Mexico's manufacturing sector across regions. We employ a Data Envelopment Analysis model that optimizes the weighted output-input ratio for each decision-making unit. Specifically, a non-radial directional distance function model is used to account for both desirable outputs and undesirable outputs, represented by greenhouse gas emissions. The findings show that including undesirable outputs reduces the estimated economic efficiency. Over the analysis period, the production frontier shifted only modestly. Regionally, northern states perform best, while southern states lag behind, revealing considerable potential for national energy and emission savings.

Keywords: Undesirable output; Energy efficiency improvements; GHG emission performance; Directional distance function (search for similar items in EconPapers)
JEL-codes: C61 D24 Q43 (search for similar items in EconPapers)
Date: 2025-06
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