Foreign Ownership and Energy Efficiency in Thai Manufacturing Plants
Keywords:
multinational enterprise, energy efficiency, spillover, Thailand, manufacturingAbstract
This paper examines two aspects of the effects of foreign multinational enterprises (MNEs) on energy efficiency in Thai manufacturing using data on medium-large plants from the industrial census for 2006. First, descriptive statistics and results of econometric estimation indicate that MNEs had a moderate tendency to use energy relatively efficiently, especially in food products, plastics, basic metals, and non-metallic mineral products. However, after accounting for the influences of plant-level factor usage and technical characteristics, differences in energy intensities between MNEs and local plants were not common, suggesting that both groups of plants generally used energy with similar efficiency. Second, industry-level, descriptive statistics suggest that MNE presence was negatively correlated with energy intensities in local plants. However, after accounting for the influences of plant-level factor usage and technical characteristics, correlations between MNE presence and energy intensities in local plants were generally positive. In other words, the econometric evidence presented here suggests that MNE presence generally leads local plants to be more energy intensive. However, this result is sensitive to the choice of sample industries, the measure of MNE presence used, and particularly to the level of aggregation used when measuring defining MNE presence.
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