Assessing multi-dimensional performance: environmental and economic outcomes

Article
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Abstract

This study examines economic performance, environmental performance, and regulatory activity for plants in three industries: pulp and paper, oil, and steel. Stochastic frontier production function models show significant deviations from production efficiency. Older plants are less efficient in production, but perform no worse on emissions. Plants spending more on pollution abatement tend to do worse on both production efficiency and emissions. Stricter local regulatory pressure is associated with somewhat lower emissions, but has mixed effects on production efficiency. Positive correlations between SUR residuals for emissions and production efficiency suggest unmeasured plant-level characteristics that drive both economic and environmental performance.

Keywords

Productivity Regulation Emissions Efficiency 

JEL Classifications

Q52 D24 
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Notes

Acknowledgments

Financial support for the research from the National Science Foundation (Grant # SBR-9410059) and the Environmental Protection Agency (Grants # R-832155-01-0 and #R-826155-01-0) is gratefully acknowledged, as is access to Census data at the Boston Research Data Center, which is partially supported by the National Science Foundation (Grant #SES-0427889). Excellent research assistance was provided by Anna Belova and Bhramar Dey. The opinions and conclusions expressed are those of the author and not the Census Bureau, EPA, or NSF. All papers are screened to ensure that they do not disclose confidential information. Any remaining errors or omissions are the authors’.

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Copyright information

© Springer Science+Business Media, LLC 2006

Authors and Affiliations

  1. 1.University of Massachusetts at DartmouthDartmouthUSA
  2. 2.National Center for Environmental EconomicsUSEPAWashingtonUSA
  3. 3.Economics DepartmentClark UniversityWorcesterUSA
  4. 4.NBERCambridgeUSA

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