The Impact of Environental Constraints on Productivity Improvement in Integrated Paper Plants

摘要

This paper utilizes a flexible measure of productivity that includes environemntal performance. We characterize the loss of potential procductive output due to environmental constrains, decomposing losses into the those resulting from the commitment of capital to pollution abaterment and those losses that arise from other sources. We also assess the potential for improvements that increase productivity and reduce pollution. Results from the paper industry show a "win-win" potential for inputs and pollution to be simultaneously reduced by 2/100 to 8/100, without reducing productivity. We also find that environmental constraints reduce production by 9/100, a quarter of which results from pollution abatement capital constraints.