Pollution Reduction by Rationalization in Indian Firms

This paper uses data for Indian firms over the period 1987 to 2016 to estimate a panel data model that considers firm heterogeneity to estimate the relationship between energy intensity and internationalization strategies of the firm. Both, the extensive and intensive margins of exports are considered as explanatory factors of energy intensity together with a number of control variables including 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. More energy-intensity industries present a higher reduction in energy intensity for exporters in comparison to non-exporters.