The impact of pollution abatement investments on production technology: new insights from frontier analysis

Jean Pierre Huiban (1) , Camille Mastromarco (2) , Antonio Musolesi (3) , Michel Simioni (4)

1 ALISS - Alimentation et sciences sociales
2 Dipartimento di Scienze dell'Economia
3 Department of Economics and Management
4 UMR MOISA - Marchés, Organisations, Institutions et Stratégies d'Acteurs

This paper estimates the impact of pollution abatement investments on the production technology of firms by pursuing two new directions. First, we take advantage of recent econometric developments in productivity and efficiency analysis and compare the results obtained with two complementary approaches: parametric stochastic frontier analysis and conditional nonparametric frontier analysis. Second, we focus not only on the average effect but also on its heterogeneity across firms and over time and search for potential nonlinearities. We provide new results suggesting that such an effect is heterogeneous both within firms and over time and indicating that the effect of pollution abatement investments on the production process is not monotonic. These results have relevant implications both for modeling and for the purposes of advice on environmentally friendly policy.

Mots clés: pollution abatement investments; technology; stochastic frontier analysis; conditional nonparametric frontier analysis; full and partial order frontiers; generalized product kernels; infinite ordre cross-validated local polynomial regression

Domaines: Méthodes et statistiques; Economies et finances

Jean Pierre Huiban, Camille Mastromarco, Antonio Musolesi, Michel Simioni. The impact of pollution abatement investments on production technology: new insights from frontier analysis. 10. Journées de recherches en sciences sociales (JRSS), Société Française d'Economie Rurale (SFER). FRA.; Centre de Coopération Internationale en Recherche Agronomique pour le Développement (CIRAD). FRA.; Institut National de la Recherche Agronomique (INRA). FRA., Dec 2016, Paris, France. 29 p. ⟨hal-01419768⟩