Going Green: Evidence from Product-Level Exports and Firms’ Environmental Performance in China

Abstract

The environmental impact of exporting is a topic of significant concern to both scholars and policymakers. Analyzing how exporting influences firms’ environmental performance concerning the product level is vital for better understanding its implications. Drawing on the data obtained from Chinese industrial firms, this study employs the PSM-DID (Propensity Score Matching-Difference in differences) model to establish a causal relationship between exporting intermediate goods or final goods and firms’ emissions. The findings indicate that, on the one hand, exporting intermediate goods leads to a rise in firms’ production scale and total factor productivity, ultimately significantly increasing total pollution emissions and reducing pollution emission intensity. On the other hand, exporting final goods decreases total pollution emissions and emission intensity through the technical effect. In general, this study provides important micro-level evidence of how exports affect pollution emissions at the product level in China. This evidence is valuable for policymakers in shaping environmental regulations and export policies.