Scandinavian Working Papers in Economics
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Research Institute of Industrial Economics (IFN) Working Paper Series

No 1035:
Firm Productivity and Carbon Leakage: A Study of Swedish Manufacturing Firms

Shon Ferguson () and Mark Sanctuary ()

Abstract: This paper examines the intensive and extensive margins of carbon leakage. The analysis uses an increase in the Swedish electricity price to identify the impact on imports at the firm and product level. Our model of heterogenous firms predicts that higher domestic electricity prices lead firms to substitute towards imports of electricity-intense products.

Keywords: Firm heterogeneity; Carbon leakage; Energy; Importing; (follow links to similar papers)

JEL-Codes: D21; F18; (follow links to similar papers)

31 pages, August 12, 2014

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