Working Paper Cnr-Ceris, N° 03/2011 

Environment and economic efficiency: an analysis of some polluting Italian industries

Alessandro Manello
University of Bergamo and Cnr-Ceris

Cnr-Ceris
Institute for Economic Research
on Firms and Growth
Via Real Collegio, 30
10024 Moncalieri (To)
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Cell. 348-7340890
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ABSTRACT: this research presents an extension of the directional distance function model to measure performances for firms which produce a large number of pollutants and operate in different industrial sectors. I use this methodology to estimate productivity indexes on a sample of Italian firms that were forced to declare their emissions to the European Pollution Release and Transfer Register in 2007. A proxy for the environmental regulation’s cost is derived and results show a significant impact in term of potential value added lost. Estimations also reveal differences in mean environmental performances among industries; furthermore, the effect of pollution control follows the same path.

Keywords: Directional distance function, Environmental regulation, Polluting industries
JEL Codes: Q50, Q52, Q56

I thank Secondo Rolfo (Director Ceris-CNR), Gianmaria Martini (University of Bergamo, Italy), Giulio Calabrese (Ceris-
CNR) and Greta Falavigna (Ceris-CNR) for valuable suggestions to study these research topics, as well as Enrico Viarisio
for excellent research assistance. This study has been financed by Piedmont Region through the project “ICT Converging on
Law: Next Generation Services for Citizens, Enterprises, Public Administration and Policymakers”, related to the announcement
“Converging Technologies 2007”. The usual disclaimer applies.”

 

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