1. ¹Department of Economics, 213 Summerfield Hall, University of Kansas and William Davidson Institute (WDI), Lawrence, KS 66045, USA
2. ²Holds Citicorp Professorship at CERGE-EI, a joint workplace of Charles University and the Academy of Sciences of the Czech Republic

Correspondence: Dietrich Earnhart, E-mail: Earnhart@ku.edu

Abstract

This paper analyses corporate environmental performance, as measured by air pollutant emissions, in the transition economy of the Czech Republic. In particular, this paper assesses whether firms face economies and/or diseconomies of scale with respect to pollution control by evaluating the effects of production on emission levels. As important, this paper assesses whether certain sectors face different scales of production – economy or diseconomy – than other sectors. To achieve these objectives, this paper uses an unbalanced panel of Czech firms for the years 1993–1998.