One CERE working paper titled "Pollution Generating Technologies and Environmental Efficiency" by Rolf Färe, Shawna Grosskopf, Tommy Lundgren, Per-Olov Marklund and Wenchao Zhou was publicized.
This paper studied environmental efficiency within a pollution generating Technology . Pollutants or bad are explicitly modelled by imposing technology properties of disposability and null-jointness. With data on firms from Swedish manufacturing, they investigate the potential to reduce emissions, with a closer look at the pulp and paper sector.
Dividing the firms into "brown" and "green" firms, they find that there is significant potential, in both categories, for pollutants to improve environmental efficiency, and consequently lower emissions. Furthermore, the authors also found that the possibility of treating biofuels as entirely carbon neutral (as is common practice) may underestimate environmental efficiency scores and generate misleading policy implications.
Read the Working Paper