Air pollution, water pollution, and robots: Is technology the panacea

The degradation of the ecological environment caused by industrialization presents a major challenge for policymakers as they aim to develop sustainability. Is there a way to balance industrial growth and environmental sustainability? To answer this pressing question, we constructed a micro-level longitudinal dataset containing 41,419 firms with 148,877 observations during 2000–2013 to develop a fine-grained understanding of the environmental implications as firms closely follow the recent technology trend in automation and intelligence. Our findings strongly support business environmental management strategies of using autonomous and intelligent technologies as a response to more rigorous environmental regulations, while caution has to be made on the notion that “technology is everything.” The increasing level of robot adoption contributes to pollution abatement in an intensive form mediated by productivity change, change-in-process, and end-of-pipe interventions. A further decomposition of the productivity effect implies that the drop in the emission intensity of the exhaust gas is due to the rise in total outputs and the decline in air pollution level. In contrast, the drop in the emission intensity for exhaust water is because of the rise of total outputs exceeding the rise of water pollution level. Furthermore, the heterogeneity analyses provide rich implications to guide environmental management practices.