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Environment and economic efficiency: an analysis of some polluting Italian industries

this research presents an extension of the directional distance function model to measure performances for firms which produce a large number of pollutants and operate in different industrial sectors. I use this methodology to estimate productivity indexes on a sample of Italian firms that were forced to declare their emissions to the European Pollution Release and Transfer Register in 2007. A proxy for the environmental regulation’s cost is derived and results show a significant impact in term of potential value added lost. Estimations also reveal differences in mean environmental performances among industries; furthermore, the effect of pollution control follows the same path.

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Paper provided by Institute for Economic Research on Firms and Growth - Moncalieri (TO) in its series CERIS Working Paper with number 201103.

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Length: 19 pages
Date of creation: Jun 2011
Date of revision:
Handle: RePEc:csc:cerisp:201103
Contact details of provider: Postal: Via Real Collegio, 30 10024 - Moncalieri TO
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  1. Rafael Cuesta & José Zofío, 2005. "Hyperbolic Efficiency and Parametric Distance Functions: With Application to Spanish Savings Banks," Journal of Productivity Analysis, Springer, vol. 24(1), pages 31-48, 09.
  2. Gale Boyd & George Tolley & Joseph Pang, 2002. "Plant Level Productivity, Efficiency, and Environmental Performance of the Container Glass Industry," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 23(1), pages 29-43, September.
  3. Ball, V. Eldon & Lovell, C.A. Knox & Luu, H. & Nehring, Richard F., 2004. "Incorporating Environmental Impacts in the Measurement of Agricultural Productivity Growth," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(03), December.
  4. Bruce Domazlicky & William Weber, 2004. "Does Environmental Protection Lead to Slower Productivity Growth in the Chemical Industry?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 28(3), pages 301-324, July.
  5. Chambers, Robert G. & Chung, Yangho & Fare, Rolf, 1996. "Benefit and Distance Functions," Journal of Economic Theory, Elsevier, vol. 70(2), pages 407-419, August.
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