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857. Digging into Environmental Productivity: Is It All about Technology?

Working Paper n.857 - Giugno 2021

Filippo Belloc

DEPS, USiena

Edilio Valentini

Department of Economic Studies, University of Chieti-Pescara
Abstract
We propose a mixture model approach to decompose environmental productivity into a managerial and a technological dimension, and to identify locally optimal technologies. For a large sample of plants covered by the EU Emission Trading System, we find that the average output gains, emissions being equal, that plants could reach by adopting the locally optimal technology and the best managerial practices available in the sector are 162% and 53% respectively, with significant cross-plant and cross-sector differentials. This data driven decomposition delivers important policy insights, as it helps predicting larger reductions in emission intensity from  exible policies than from one-size-fits-all technology-based standards
Keywords
Environmental productivity, Emission intensity, Environmental technology, Environmental management
Jel Codes
D24, L60, Q54, Q55