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Firm Productivity and Carbon Leakage: A Study of Swedish Manufacturing Firms

Author

Listed:
  • Ferguson, Shon

    (Research Institute of Industrial Economics (IFN))

  • Sanctuary, Mark

    (Beijer Institute of Ecological Economics)

Abstract

This paper examines the intensive and extensive margins of carbon leakage. The analysis uses an increase in the Swedish electricity price to identify the impact on imports at the firm and product level. Our model of heterogenous firms predicts that higher domestic electricity prices lead firms to substitute towards imports of electricity-intense products.

Suggested Citation

  • Ferguson, Shon & Sanctuary, Mark, 2014. "Firm Productivity and Carbon Leakage: A Study of Swedish Manufacturing Firms," Working Paper Series 1035, Research Institute of Industrial Economics.
    • Handle: RePEc:hhs:iuiwop:1035
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    File URL: https://www.ifn.se/wfiles/wp/wp1035.pdf
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    References listed on IDEAS

    as
    1. Tomlin, Ben, 2014. "Exchange rate fluctuations, plant turnover and productivity," International Journal of Industrial Organization, Elsevier, vol. 35(C), pages 12-28.
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    4. Grossman, Gene M. & Helpman, Elhanan, 1991. "Trade, knowledge spillovers, and growth," European Economic Review, Elsevier, vol. 35(2-3), pages 517-526, April.
    5. Kasahara, Hiroyuki & Lapham, Beverly, 2013. "Productivity and the decision to import and export: Theory and evidence," Journal of International Economics, Elsevier, vol. 89(2), pages 297-316.
    6. James A. Schmitz Jr., 2005. "What Determines Productivity? Lessons from the Dramatic Recovery of the U.S. and Canadian Iron Ore Industries Following Their Early 1980s Crisis," Journal of Political Economy, University of Chicago Press, vol. 113(3), pages 582-625, June.
    7. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    8. Ekholm, Karolina & Moxnes, Andreas & Ulltveit-Moe, Karen Helene, 2012. "Manufacturing restructuring and the role of real exchange rate shocks," Journal of International Economics, Elsevier, vol. 86(1), pages 101-117.
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    More about this item

    Keywords

    Firm heterogeneity; Carbon leakage; Energy; Importing;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • F18 - International Economics - - Trade - - - Trade and Environment

    NEP fields

    This paper has been announced in the following NEP Reports:

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