Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/283593 
Authors: 
Year of Publication: 
2023
Series/Report no.: 
ZEW Discussion Papers No. 23-070
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
Rising energy prices might lead to adjustments along the supply chain and make firms outsource energy-intensive processes. This could lead to carbon leakage. I provide empirical evidence whether energy price-induced offshoring occurs using firm-level data on energy use, imports, and material purchases. I document that import shares in German industry have increased between 2009 and 2013, and that energy prices correlate positively with imports. Despite this positive correlation, I show in a quasi-experimental setup that a sudden drastic drop in electricity prices has not led firms to significantly reduce their imports or their domestic material purchases relative to an unaffected control group. This holds for very electricityintensive firms; for firms using easily tradable goods; and both for regular importers with a trade network and occasional/non-importers.
Subjects: 
Offshoring
Energy Prices
Climate Policy
Manufacturing
JEL: 
F14
F18
L60
Q41
Q56
Document Type: 
Working Paper

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