Regulating Mismeasured Pollution: Implications of Firm Heterogeneity for Environmental Policy

Eva Lyubich, Joseph S. Shapiro, Reed Walker

NBER Working Paper No. 24228
Issued in January 2018, Revised in April 2018
NBER Program(s):Environment and Energy Economics, International Trade and Investment, Public Economics, Productivity, Innovation, and Entrepreneurship

This paper provides the first estimates of within-industry heterogeneity in energy and CO2 productivity for the entire U.S. manufacturing sector. We measure energy and CO2 productivity as output per dollar energy input or per ton CO2 emitted. Three findings emerge. First, within narrowly defined industries, heterogeneity in energy and CO2 productivity across plants is enormous. Second, heterogeneity in energy and CO2 productivity exceeds heterogeneity in most other productivity measures, like labor or total factor productivity. Third, heterogeneity in energy and CO2 productivity has important implications for environmental policies targeting industries rather than plants, including technology standards and carbon border adjustments.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w24228

Published: Eva Lyubich & Joseph Shapiro & Reed Walker, 2018. "Regulating Mismeasured Pollution: Implications of Firm Heterogeneity for Environmental Policy," AEA Papers and Proceedings, vol 108, pages 136-42.

Users who downloaded this paper also downloaded* these:
Jack, Jayachandran, and Rao w24192 Environmental Externalities and Free-riding in the Household
AntrĂ s and Chor w24185 On the Measurement of Upstreamness and Downstreamness in Global Value Chains
Agrawal, Gans, and Goldfarb w24284 Human Judgment and AI Pricing
Freeman, Liang, Song, and Timmins w24157 Willingness to Pay for Clean Air in China
Goldfarb and Trefler w24254 AI and International Trade
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us