The first empirical exercise measures the relative air pollution intensity of small and large plants in the Mexican database. Intensities are computed as particulate emissions per unit of labor, because comparable output data are not available. Using the sample of 6,000 plants, the logarithm of emissions per employee is first regressed on logarithm of actual plant level employment, with dummy variables to control for sectoral differences. Table 1 shows the average emission intensity for each sector and plant size category. While the general pattern is consistent with a negative relationship between pollution per employee and plant size, it also reveals substantial variation.
Emissions intensity is measured so far by the physical volume of emissions per employee.
A true measure of pollution intensity, however, must also consider the impact of emissions on air quality. Technical models of atmospheric dispersion treat large and small facilities separately, because of differences in average stack heights. Large plants have higher stacks, producing substantially lower pollutant concentration per unit of emissions. The standard dispersion model used for World Bank project analysis 4 implies that each unit of particulate emissions from a small plant increases air pollution approximately 14 times more than a unit of emissions from a large facility because of the difference in stack size. In combination with the broad pattern noted in the regressions, and even relative to almost all of the sector specific patterns in Table 1, this implies much greater pollution per employee for small plants.