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The True Cost of Greenhouse Gas Emissions: Analysis of 1,000 Global Companies

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  • Nagisa Ishinabe
  • Hidemichi Fujii
  • Shunsuke Managi

Abstract

This study elucidated the shadow price of greenhouse gas (GHG) emissions for 1,024 international companies worldwide that were surveyed from 15 industries in 37 major countries. Our results indicate that the shadow price of GHG at the firm level is much higher than indicated in previous studies. The higher shadow price was found in this study as a result of the use of Scope 3 GHG emissions data. The results of this research indicate that a firm would carry a high cost of GHG emissions if Scope 3 GHG emissions were the focus of the discussion of corporate social responsibility. In addition, such shadow prices were determined to differ substantially among countries, among sectors, and within sectors. Although a number of studies have calculated the shadow price of GHG emissions, these studies have employed country-level or industry-level data or a small sample of firm-level data in one country. This new data from a worldwide firm analysis of the shadow price of GHG emissions can play an important role in developing climate policy and promoting sustainable development.

Suggested Citation

  • Nagisa Ishinabe & Hidemichi Fujii & Shunsuke Managi, 2013. "The True Cost of Greenhouse Gas Emissions: Analysis of 1,000 Global Companies," PLOS ONE, Public Library of Science, vol. 8(11), pages 1-9, November.
    • Handle: RePEc:plo:pone00:0078703
    DOI: 10.1371/journal.pone.0078703
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    References listed on IDEAS

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    1. Fare, Rolf & Grosskopf, Shawna & Noh, Dong-Woon & Weber, William, 2005. "Characteristics of a polluting technology: theory and practice," Journal of Econometrics, Elsevier, vol. 126(2), pages 469-492, June.
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    1. Yagi, Michiyuki & Hidemichi, Fujii & Hoang, Vincent & Managi, Shunsuke, 2015. "Environmental efficiency of energy, materials, and emissions," MPRA Paper 65358, University Library of Munich, Germany.
    2. Peihao Lai & Minzhe Du & Bing Wang & Ziyue Chen, 2016. "Assessment and Decomposition of Total Factor Energy Efficiency: An Evidence Based on Energy Shadow Price in China," Sustainability, MDPI, vol. 8(5), pages 1-23, April.
    3. Wayne Fu & Che‐Ping (Jack) Su, 2021. "The implications of efficiency differences in sustainable development: An empirical study in the consumer product industry," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2489-2504, July.
    4. Fujii, Hidemichi & Managi, Shunsuke, 2015. "Trends in corporate environmental management studies and databases," MPRA Paper 66531, University Library of Munich, Germany.
    5. Tamaki, Tetsuya & Shin, Kong Joo & Nakamura, Hiroki & Fujii, Hidemichi & Managi, Shunsuke, 2018. "Shadow prices and production inefficiency of mineral resources," Economic Analysis and Policy, Elsevier, vol. 57(C), pages 111-121.

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