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This paper exploits newly available information on firms’ direct (own production) and indirect (supplier-generated) carbon emission intensities and transaction-level imports to conduct an in-depth analysis of whether and how U.S. firms address climate change.
We find robust evidence that when firms increase their imports, their own emissions fall with a corresponding rise in supplier generated emissions. Several quasi-natural experiments further support this pivotal evidence that U.S. firms outsource some of their pollutions abroad. We show that firms, management, and directors with desires to maintain high environmental standings and environmentally-conscious customers and investors play a role in corporate environmental policies. Finally, firms with more imported emissions tend to have higher reputational risks and larger future stock returns but are less incentivized to develop clean technologies.
The firms listed on the stock market in aggregate contribute less to total non-farm employment and GDP now than in the 1970s. A major reason for this...
We construct measures of firms' beliefs about climate regulation, plans for future abatement, and current emissions mitigation from responses to the...