{"title":"Catching up and falling behind: Cross-country evidence on the impact of the EU ETS on firm productivity","authors":"Nicolas Koch , Michael Themann","doi":"10.1016/j.reseneeco.2022.101315","DOIUrl":null,"url":null,"abstract":"<div><p>This paper identifies the impact of the European Union Emissions Trading System<span> (EU ETS) on firm productivity. We estimate a stylized version of the neo-Schumpeterian productivity model to differentiate dynamic forces of productivity convergence from the policy effect of the EU ETS depending on the level of firms’ technological advancement. The identification is based on a difference-in-differences approach exploiting the incomplete participation requirements of the EU ETS and the rich panel structure of a representative dataset for firm-level total factor productivity (TFP) in eight EU countries from 2002 to 2012. We show that the policy effect on TFP is nonlinear in the distance to the technological frontier within the industry. The EU ETS spurs productivity among firms close to the frontier but slows down catch-up growth among laggard firms.</span></p></div>","PeriodicalId":47952,"journal":{"name":"Resource and Energy Economics","volume":"69 ","pages":"Article 101315"},"PeriodicalIF":2.6000,"publicationDate":"2022-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Resource and Energy Economics","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S092876552200032X","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
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Abstract
This paper identifies the impact of the European Union Emissions Trading System (EU ETS) on firm productivity. We estimate a stylized version of the neo-Schumpeterian productivity model to differentiate dynamic forces of productivity convergence from the policy effect of the EU ETS depending on the level of firms’ technological advancement. The identification is based on a difference-in-differences approach exploiting the incomplete participation requirements of the EU ETS and the rich panel structure of a representative dataset for firm-level total factor productivity (TFP) in eight EU countries from 2002 to 2012. We show that the policy effect on TFP is nonlinear in the distance to the technological frontier within the industry. The EU ETS spurs productivity among firms close to the frontier but slows down catch-up growth among laggard firms.
期刊介绍：
Resource and Energy Economics provides a forum for high level economic analysis of utilization and development of the earth natural resources. The subject matter encompasses questions of optimal production and consumption affecting energy, minerals, land, air and water, and includes analysis of firm and industry behavior, environmental issues and public policies. Implications for both developed and developing countries are of concern. The journal publishes high quality papers for an international audience. Innovative energy, resource and environmental analyses, including theoretical models and empirical studies are appropriate for publication in Resource and Energy Economics.
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