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Aggregate green productivity growth in OECD’s countries

Author

Listed:
  • Zhiyang Shen

    (IESEG School of Management (LEM 9221-CNRS))

  • Jean-Philippe Boussemart

    (University of Lille 3 and IESEG School of Management (LEM 9221-CNRS))

  • Hervé Leleu

    (CNRS-LEM 9221 and IESEG School of Management)

Abstract

Most of previous research about Total Factor Productivity (TFP) at the macro level only emphasizes technical effect and technological progress at the country level, but it ignores structural effect for a group of countries at the aggregate level. This paper attempts to measure the green productivity evolution incorporating carbon dioxide emissions based on the Luenberger TFP indicator for a group of 30 OECD countries over the period of 1971-2011. We propose a novel decomposition for green productivity growth at the aggregate level which separates TFP changes into three components: technological progress, technical efficiency change, and structural efficiency change. The structural effect captures the heterogeneity in the combination of input and output mixes among countries that can impact TFP growth at a more aggregate level. In the literature, this effect has not been quantified for a group of nations such as the OECD countries. Our results indicate that the traditional TFP index underestimates green growth which is motivated by the effective and efficient environmental policies of the OECD. The green productivity growth is mainly driven by technology progress which has become a dominant force in the 21st century.

Suggested Citation

  • Zhiyang Shen & Jean-Philippe Boussemart & Hervé Leleu, 2015. "Aggregate green productivity growth in OECD’s countries," Working Papers 2016-EQM-03, IESEG School of Management.
  • Handle: RePEc:ies:wpaper:e201603
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    More about this item

    Keywords

    Undesirable Output; Carbon Dioxide Emissions; Total Factor Productivity; Weak Disposability;
    All these keywords.

    JEL classification:

    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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