Dana Andersen presents Credit Constraints and the Environment Workshop

Dana discussed the role credit constraints in firm investment decisions and the repercussions for environmental performance at the April 10th Institute for Public Economics workshop.

Staff Writier - 20 April 2018

On Tuesday April 10, 2018 Dana Andersen Assistant Professor, Department of Economics presented a seminar as part of the Institute for Public Economics Workshop series.

In his workshop Credit Constraints and the Environment, Dana discussed the role credit constraints in firm investment decisions and the repercussions for environmental performance. His research demonstrates that well-functioning credit markets significantly improve environmental outcomes, both at the firm-level among manufacturing producers and at the country-level for overall air pollution concentrations.

Dana further states, "Access to credit is indispensable in financing firm investments and therefore bears on capital-investment and technology decisions. Technology choices include investment in pollution abatement technologies and more generally investment in technologies reducing input requirements, including fuel and material requirements in production. Because pollution emissions are inextricably linked to technology and abatement choices, credit constraints bear on environmental performance whenever they influence investment decisions. This workshop discusses the role of credit constraints in firm investment decisions and the repercussions for firm-level environmental performance and aggregate environmental outcomes. Empirical investigations of the effect of credit constraints on (i) firm-level air pollution emissions for manufacturing plants and (ii) country-level air pollution concentrations demonstrates that well-functioning credit markets significantly improve environmental outcomes".

Presentation Slides