Growth, Firm Scale, and the Energy Intensity of Production — by Kathryn McDonald, Noémie Pinardon-Touati, Conor Walsh
We uncover a new mechanism that links growth and a decline in the energy intensity of production, observed globally since 1990. Using microdata from India and a causal research design, we demonstrate that the expenditure share of energy declines steeply with firm scale, due both to physical scaling laws and technology investment. Given that average…