Abstract
In decomposing the total emissions into scale and pollution intensity, the conventional approach uses the total output as a measure of scale, and hence ignores the fact that pollution is mainly a byproduct of the manufacturing activity. This study recognizing that air pollution is mainly a byproduct of manufacturing activity proposes a new definition of pollution intensity—pollution per unit of manufacturing output—, and a new technique to measure the aggregate pollution intensity. The index used is a variant of Malmquist quantity index and satisfies well-established axiomatic properties. One other focal point of this study is the overtime comparisons of pollution intensities, i.e., change in pollution intensity, using indexes that are firmly established in productivity growth literature.
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