Policy Article

Pollution Reduction by Rationalization in Indian Firms

INFER Briefs, 2021.01

We investigate the relationship between energy intensity and firms’ internationalization strategies by using data for Indian firms over the period 1987 to 2016 to estimate a panel data model that considers firm heterogeneity. Energy intensity is explained by the extensive and intensive margins of exports, estimated total factor productivity, foreign ownership, size and innovation activities. The main results indicate that exporters are more energy efficient than non-exporters, and that there is heterogeneity between industries. In particular, more energy-intensive industries present a higher reduction in energy intensity for exporters in comparison to non-exporters.

Authors

Inma Martínez-Zarzoso
Shampa Roy-Mukherjee
Anca M. Voicu