--- title: "Labour Productivity and Development of Carbon Competitiveness: Industry-Level Evidence from Europe" authors: - name: "Kaitila, Ville" url: "https://www.etla.fi/henkilot/kaitila-ville/" sameAs: - "https://orcid.org/0000-0002-9050-3431" - "https://scholar.google.com/citations?user=iYY2NssAAAAJ" - "https://twitter.com/villekaitila" date_published: "2023-05-22" series: "ETLA Raportit - Reports" series_number: "139" issn: - "2323-2447" - "2323-2455" jel_codes: - "C23" - "O44" - "Q54" - "Q56" language: "en" publisher: "ETLA Economic Research" pdf_url: "https://www.etla.fi/wp-content/uploads/ETLA-Raportit-Reports-139.pdf" keywords: - "Greenhouse gas emissions (GHG)" - "GHG-intensity" - "Carbon competitiveness" - "Productivity" - "ETS" identifier: "https://www.etla.fi/julkaisut/id/ETLA-Raportit---Reports-139" abstract: "A drastic decline in global greenhouse gas (GHG) emissions is needed to stop the climate change. This requires a variety of political and market mechanisms. Europe is globally at the forefront among the industrialised countries in reducing its GHG emissions. We analyse the development of emission intensities – GHG emissions relative to value added produced – and use a panel data to further our understanding of their evolution at the level of industries in 2008–2020 in Europe. We find that labour productivity is negatively associated with changes in GHG-emission intensities. Furthermore, higher investments, higher carbon prices within the ETS mechanism, and higher environmental taxes are associated with lower GHG-emission intensities. Consequently, policies that promote productivity growth and financial incentives to decrease emissions lead to lower emissions. Finland’s carbon competitiveness, as measured by relative GHG-emission intensities, varies by industries. See also Etla Brief no 123 Carbon Competitiveness is Shaped in Firms (in Finnish)." --- # Labour Productivity and Development of Carbon Competitiveness: Industry-Level Evidence from Europe **Published:** 2023-05-22 **Categories:** Rapporter **URL:** https://www.etla.fi/sv/publikationer/rapporter/labour-productivity-and-development-of-carbon-competitiveness-industry-level-evidence-from-europe/ #### Abstract A drastic decline in global greenhouse gas (GHG) emissions is needed to stop the climate change. This requires a variety of political and market mechanisms. Europe is globally at the forefront among the industrialised countries in reducing its GHG emissions. We analyse the development of emission intensities – GHG emissions relative to value added produced – and use a panel data to further our understanding of their evolution at the level of industries in 2008–2020 in Europe. We find that labour productivity is negatively associated with changes in GHG-emission intensities. Furthermore, higher investments, higher carbon prices within the ETS mechanism, and higher environmental taxes are associated with lower GHG-emission intensities. Consequently, policies that promote productivity growth and financial incentives to decrease emissions lead to lower emissions. Finland’s carbon competitiveness, as measured by relative GHG-emission intensities, varies by industries. See also [Etla Brief no 123](https://www.etla.fi/sv/publikationer/promemoria/tuotannon-hiilikilpailukyky-ratkaistaan-yrityksissa/) *Carbon Competitiveness is Shaped in Firms* (in Finnish). --- ## Additional Information **Kirjoittajat:** Kaitila, Ville **Publication Research:** No 65339 **Kansikuva:** https://www.etla.fi/wp-content/uploads/etla-raportit-reports-139-kansi.jpg **Lataa Pdf:** https://www.etla.fi/wp-content/uploads/ETLA-Raportit-Reports-139.pdf **Key Words:** Greenhouse gas emissions (GHG), GHG-intensity, Carbon competitiveness, Productivity, ETS **Jel:** C23, O44, Q54, Q56 **Paivays:** 22.05.2023 **Sivuja:** 28 **Kieli:** en **Sarja:** ETLA Raportit - Reports **Sarja Nro:** 139 **Issn:** 2323-2447, 2323-2455 (Pdf) **Saatavuus:** 2 ## Bibliographic metadata (JSON-LD) ```json { "@context": "https://schema.org", "@type": "ScholarlyArticle", "@id": "https://www.etla.fi/julkaisut/id/ETLA-Raportit---Reports-139", "headline": "Labour Productivity and Development of Carbon Competitiveness: Industry-Level Evidence from Europe", "inLanguage": "en", "publisher": { "@type": "Organization", "name": "ETLA Economic Research", "url": "https://www.etla.fi", "logo": { "@type": "ImageObject", "url": "https://www.etla.fi/wp-content/uploads/logo-etla_logo.svg" } }, "datePublished": "2023-05-22T00:00:00+00:00", "author": [ { "@type": "Person", "name": "Kaitila, Ville", "url": "https://www.etla.fi/henkilot/kaitila-ville/", "sameAs": [ "https://orcid.org/0000-0002-9050-3431", "https://scholar.google.com/citations?user=iYY2NssAAAAJ", "https://twitter.com/villekaitila" ] } ], "abstract": "A drastic decline in global greenhouse gas (GHG) emissions is needed to stop the climate change. 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