Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms

Yunguo Lu; Zhe Jiang; Lin Zhang

doi:10.1177/01956574251322140

Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms

Yunguo Lu
, Zhe Jiang
, Lin Zhang^*

^*Corresponding author for this work

Research output: Journal Publications and Reviews › RGC 21 - Publication in refereed journal › peer-review

3 Citations (Scopus)

46 Downloads (CityUHK Scholars)

Abstract

This study examines the effect of privatization on the pollution emission intensity of companies by exploiting the quasi-natural experimental ownership reforms of state-owned enterprises in China. By matching corporate pollution emissions with firm-level microdata from 1998 to 2007, we employ a difference-in-differences strategy to identify the environmental effects of privatization. Our findings reveal a significant increase in corporate SO2 intensity and smoke and dust intensity by 12.5 percent and 12.3 percent, respectively. The magnitude of the effect varies significantly across regions and differs by the nature of ownership. We observe significant changes in production technologies and environmental mitigation strategies in state-owned enterprises (SOEs) after privatization. Privatized SOEs undergo major changes in their corporate energy input structures and tend to make a significant strategic shift in their approach to pollution mitigation, investing less in environmental innovation in production and focusing more on end-of-pipe treatments.
© IAEE 2025

Original language	English
Pages (from-to)	87-116
Journal	Energy Journal
Volume	46
Issue number	4
Online published	31 Mar 2025
DOIs	https://doi.org/10.1177/01956574251322140
Publication status	Published - Jul 2025

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was financially supported by Zhejiang Provincial Philosophy and Social Sciences Planning Project ''The 3rd Plenary Session of the 20th CPC Central Committee and the 5th Plenary Session of the 15th CPC Provincial Committee Spiritual Research and Interpretation,'' Zhejiang Sci-Tech University (23092085-Y), the Research Grants Council of Hong Kong (N_CityU146/23, CityU11503223), and the Science and Technology Innovation Commission of Shenzhen Municipality (JCYJ20240813153136047).

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 9 Industry, Innovation, and Infrastructure

Research Keywords

privatization
ownership reform
corporate environmental performance state-owned enterprises

Publisher's Copyright Statement

COPYRIGHT TERMS OF DEPOSITED POSTPRINT FILE: The article is protected by copyright and reuse is restricted to non-commercial and no derivative uses. Users may also download and save a local copy of an article accessed in an institutional repository for the user's personal reference. For permission to reuse an article, please follow our Process for Requesting Permission. Lu, Y., Jiang, Z., & Zhang, L. (2025), Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms. Energy Journal, 46(4), pp. 87-116. Copyright © IAEE 2025. DOI: 10.1177/01956574251322140

RGC Funding Information

RGC-funded

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10.1177/01956574251322140

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Cite this

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title = "Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms",

abstract = "This study examines the effect of privatization on the pollution emission intensity of companies by exploiting the quasi-natural experimental ownership reforms of state-owned enterprises in China. By matching corporate pollution emissions with firm-level microdata from 1998 to 2007, we employ a difference-in-differences strategy to identify the environmental effects of privatization. Our findings reveal a significant increase in corporate SO2 intensity and smoke and dust intensity by 12.5 percent and 12.3 percent, respectively. The magnitude of the effect varies significantly across regions and differs by the nature of ownership. We observe significant changes in production technologies and environmental mitigation strategies in state-owned enterprises (SOEs) after privatization. Privatized SOEs undergo major changes in their corporate energy input structures and tend to make a significant strategic shift in their approach to pollution mitigation, investing less in environmental innovation in production and focusing more on end-of-pipe treatments. {\textcopyright} IAEE 2025",

keywords = "privatization, ownership reform, corporate environmental performance state-owned enterprises",

author = "Yunguo Lu and Zhe Jiang and Lin Zhang",

year = "2025",

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doi = "10.1177/01956574251322140",

language = "English",

volume = "46",

pages = "87--116",

journal = "Energy Journal",

issn = "0195-6574",

publisher = "Sage Publications",

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TY - JOUR

T1 - Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms

AU - Lu, Yunguo

AU - Jiang, Zhe

AU - Zhang, Lin

PY - 2025/7

Y1 - 2025/7

N2 - This study examines the effect of privatization on the pollution emission intensity of companies by exploiting the quasi-natural experimental ownership reforms of state-owned enterprises in China. By matching corporate pollution emissions with firm-level microdata from 1998 to 2007, we employ a difference-in-differences strategy to identify the environmental effects of privatization. Our findings reveal a significant increase in corporate SO2 intensity and smoke and dust intensity by 12.5 percent and 12.3 percent, respectively. The magnitude of the effect varies significantly across regions and differs by the nature of ownership. We observe significant changes in production technologies and environmental mitigation strategies in state-owned enterprises (SOEs) after privatization. Privatized SOEs undergo major changes in their corporate energy input structures and tend to make a significant strategic shift in their approach to pollution mitigation, investing less in environmental innovation in production and focusing more on end-of-pipe treatments. © IAEE 2025

AB - This study examines the effect of privatization on the pollution emission intensity of companies by exploiting the quasi-natural experimental ownership reforms of state-owned enterprises in China. By matching corporate pollution emissions with firm-level microdata from 1998 to 2007, we employ a difference-in-differences strategy to identify the environmental effects of privatization. Our findings reveal a significant increase in corporate SO2 intensity and smoke and dust intensity by 12.5 percent and 12.3 percent, respectively. The magnitude of the effect varies significantly across regions and differs by the nature of ownership. We observe significant changes in production technologies and environmental mitigation strategies in state-owned enterprises (SOEs) after privatization. Privatized SOEs undergo major changes in their corporate energy input structures and tend to make a significant strategic shift in their approach to pollution mitigation, investing less in environmental innovation in production and focusing more on end-of-pipe treatments. © IAEE 2025

KW - privatization

KW - ownership reform

KW - corporate environmental performance state-owned enterprises

UR - https://www.webofscience.com/wos/woscc/full-record/WOS:001455234900001

U2 - 10.1177/01956574251322140

DO - 10.1177/01956574251322140

M3 - RGC 21 - Publication in refereed journal

SN - 0195-6574

VL - 46

SP - 87

EP - 116

JO - Energy Journal

JF - Energy Journal

IS - 4

ER -

Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms

Abstract

Funding

UN SDGs

Research Keywords

Publisher's Copyright Statement

RGC Funding Information

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GRF: Climate Financing of Ongoing and Intensified Climate Change: Evidence from Tropical Cyclones in the Coastal Cities in China

NSFC: Asset-stranding Risks of Energy Firms under the Carbon Neutrality Goals and Spillover Effects on the Capital Market in mainland China and Hong Kong

Cite this

Effects of Ownership Reform on Energy and Emission Intensity of Chinese Firms

Abstract

Funding

UN SDGs

Research Keywords

Publisher's Copyright Statement

RGC Funding Information

Access Output

Other Access Options

Permanent Link

Other Files and Links

Fingerprint

Projects

GRF: Climate Financing of Ongoing and Intensified Climate Change: Evidence from Tropical Cyclones in the Coastal Cities in China

NSFC: Asset-stranding Risks of Energy Firms under the Carbon Neutrality Goals and Spillover Effects on the Capital Market in mainland China and Hong Kong

Cite this