Productivity Growth and Environmental Regulation in Mexican and U.S. Food Manufacturing

Alpay, Ebru; Kerkvliet, Joe; Buccola, Steven T.

doi:10.1111/1467-8276.00041

Cited by 205 publications

(117 citation statements)

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“…Another strand of studies in the distance function framework is stochastic production frontier analysis (SFA), which includes a stochastic error term in the computation of the production possibility frontier, e.g., [8,18]. Finally, total factor productivity (TFP) is used in numerous studies [2,6,[19][20][21][22][23][24][25][26][27][28][29]. The literature on TFP measurements has lately incorporated bad outputs.…”

Section: Previous Researchmentioning

confidence: 99%

“…Studies analysing the pulp and paper industry include case studies of individual companies [5], industry-scale studies [7,22], and cross-country studies comparing effects on the manufacturing sector or general macroeconomic performance [14,16,25,40,41]. In addition to the studies focusing directly on the impact of environmental regulations on productivity and technical change, there are studies analysing the effects of environmental regulations on labour and capital productivity [6,38,42]; on investments and age of the capital stock [43,44]; and on industry profitability [7,30,45].…”

Section: Previous Researchmentioning

confidence: 99%

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Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Brolund

Lundmark

2017

Sustainability

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Abstract:The article investigates whether environmental regulations have affected productivity development and technological change in the European pulp and paper industry. A dynamic panel data approach is selected for analyzing a sample consisting of the pulp and paper industries in eight European countries. Industry total factor productivity for the period 1993-2009 is used as the dependent variable; it is explained by the intensities of environmental regulations for various types of pollutants, as well as by a number of other independent variables. The econometric results indicate that the regulation of nitrogen oxides is associated with productivity improvements with a one-year lag, whereas regulations regarding sulphur dioxide and carbon dioxide have not had any statistically significant impact. In line with the a priori expectations, the price of pulp is connected to a negative effect, while lagged R&D expenditures have had corresponding positive impacts. However, since stationary tests are asymptotic and the data series are quite short, strong conclusions regarding the actual causal effect of environmental policy could not be drawn. The results could therefore not be viewed as a proof of the so-called strong Porter hypothesis postulating that stringent well-designed environmental regulations increase productivity growth compared to a no-policy scenario.

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Section: Previous Researchmentioning

confidence: 99%

Section: Previous Researchmentioning

confidence: 99%

Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Brolund

Lundmark

2017

Sustainability

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“…Alpay, Buccola, and Kerkvliet (2002) in a comparison of the US and Mexican food industries, found that when Mexico increased its pollution controls this lead to enhanced food production and productivity growth. , in a study of 4200 facilities in seven OECD countries, find evidence that environmental regulation induces innovation and that the costs of complying with this regulation are partially offset by this new innovation.…”

Section: Eco-innovation and Firm Performancementioning

confidence: 99%

Regulation and firm perception, eco‐innovation and firm performance

Doran

Ryan

2012

European Journal of Innovation Management

273

224

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Purpose -Recent OECD (2010, 2011) reports argue that eco-innovation is the key to realising growth. The purpose of this paper is to analyse the drivers of eco-innovation and to compare the impact of eco-innovation and non-eco-innovation on firm performance. The paper provides insights into the role government regulation can play in directing and stimulating eco-innovation. Design/methodology/approach -The approach utilised by this paper is empirical in nature. A modified innovation production function is used to assess the impact of regulation, consumer expectations and voluntary agreements on the performance of eco-innovation while a knowledge augmented production function is used to assess the impact of eco-innovation on firm performance. Findings -The findings suggest that regulation and customer perception can explain a firm"s decision to engage in eco-innovation. Eco-innovation is also found to be more important than non-eco-innovation in determining firm performance. Research limitations/implications -Due to the limited availability of accounting data this paper uses turnover per worker as the measure of firm performance. As a result it is not possible to assess the impact of eco-innovation on firm costs. Social implications -The finding that regulation drives eco-innovation and that there is no trade-off between the optimal outcomes of lower levels of pollution for society and higher profit margins for businesses suggests that regulators and policy makers can stimulate growth and create a greener society. Originality/value -This paper provides an empirical analysis of the Porter and van der Linde"s (1995) theory of environmental regulation and firm performance using novel real world data from over 2,000 Irish businesses.

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“…The only cross-country study, Alpay et al (2002), similarly find no effect on adjusted productivity growth on the US food manufacturing sector, but a positive one in Mexico.…”

mentioning

confidence: 90%

Environmental Policies and Productivity Growth

2013

OECD Economics Department Working Papers

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JT03348802Complete document available on OLIS in its original format This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. ECO/WKP(2013) The economic effects of environmental policies are of central interest to policymakers. The traditional approach sees environmental policies as a burden on economic activity, at least in the short to medium term, as they raise costs without increasing output and restrict the set of production technologies and outputs. In contrast, the Porter Hypothesis claims that well-designed environmental policies can provide a 'free lunch' -encouraging innovation, bringing about gains in profitability and productivity that can outweigh the costs of the policy. This paper reviews the empirical evidence on the link between environmental policy stringency and productivity growth, and the various channels through which such effects can take place. The results are ambiguous, in particular as many of the studies are fragile and context-specific, impeding the generalisation of conclusions. Practical problems related to data, measurement and estimation strategies are discussed, leading to suggestions how they can be addressed in future research. These include: improving the measurement of environmental policy stringency; investigating into effects of different types of instruments and details of instrument design; exploiting cross-country variation; and the complementary use of different levels of aggregation. *********************************88 JEL classification codes Politiques environnementales et croissance de la productivité -un examen critique des résultats empiriquesLes effets économiques des politiques environnementales revêtent un intérêt crucial pour les responsables de l'action publique. Suivant l'approche classique, les politiques environnementales sont considérées comme un fardeau pour l'activité économique, au moins dans une perspective de court à moyen terme, étant donné qu'elles entraînent une hausse des coûts sans pour autant faire augmenter la production et qu'elles limitent l'éventail des technologies de production et des produits. À l'inverse, suivant l'hypothèse de Porter, des politiques environnementales judicieusement conçues peuvent procurer des avantages sans contrepartie, en encourageant l'innovation et en débouchant sur des gains de rentabilité et de productivité qui peuvent l'emporter sur les coûts des politiques considérées. Nous examinons dans ce document de travail les données empiriques relatives à la relation existant entre la rigueur des politiques environnementales et la croissance de la productivité, ainsi que les différents canaux via lesquels les effets considérés peuvent se produire. Les résultats de cet examen sont ambigus, notamment dans la mesure où de nombreuses études sont fragiles et spécifiquement liées à un contexte donné, ce qui ne permet pas d'en généraliser les conclusions. Des p...

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Productivity Growth and Environmental Regulation in Mexican and U.S. Food Manufacturing

Cited by 205 publications

References 20 publications

Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Regulation and firm perception, eco‐innovation and firm performance

Environmental Policies and Productivity Growth

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