Searching for carbon leaks in multinational companies

By Antoine Dechezleprêtre, C. Gennaioli, Ralf Martin, Mirabelle Muûls, T. Stoerk. Journal of Environmental Economics and Management, 2019

141 citations recorded by the source corpus.

Does climate change policy cause companies to shift the location of production, thereby creating carbon leakage? We examine the impact of the European Union Emissions Trading System (EU ETS) on the geographical distribution of carbon emissions within multinational companies based on data from the Carbon Disclosure Project for the period 2007- 2009. Our data includes regional emissions of 435 companies, of which 47 are subject to EU ETS regulation. We find no evidence that the EU ETS has induced a displacement of carbon emissions from Europe towards the rest of the world. Our results suggest that claims that the EU ETS would cause carbon leakage might have been exaggerated.

Subfields: Economics and Econometrics, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/cfa8f5a5f0a66704739e734e941cee828f18eb02