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Trade Liberalization and Pollution Havens

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  • Ederington Josh

    ()
    (University of Kentucky)

  • Levinson Arik

    ()
    (Georgetown University)

  • Minier Jenny

    ()
    (University of Kentucky)

Abstract

U.S. Presidential Executive Order 13141 commits the United States to a careful assessment and consideration of the environmental impacts of trade agreements. The most direct mechanism through which trade liberalization would affect environmental quality in the U.S. is through the composition of industries. Freer trade means greater specialization, increasing the concentration of polluting industries in some countries and decreasing it in others. We begin by documenting the substantial shift in U.S. manufacturing toward cleaner industries from 1972 to 1994. We then use annual industry-level data on imports to the U.S. to examine whether this compositional shift can be traced to the significant trade liberalization that occurred over the same time period, and we conclude that no such connection exists. A shift toward cleaner industries has also occurred among U.S. imports, and we find no evidence that pollution-intensive industries have been disproportionately affected by the tariff changes.

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Bibliographic Info

Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 3 (2004)
Issue (Month): 2 (November)
Pages: 1-24

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Handle: RePEc:bpj:bejeap:v:advances.4:y:2004:i:2:n:6

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  1. Josh Ederington & Arik Levinson & Jenny Minier, 2005. "Footloose and Pollution-Free," The Review of Economics and Statistics, MIT Press, vol. 87(1), pages 92-99, February.
  2. Hettige, Hemamala & Lucas, Robert E B & Wheeler, David, 1992. "The Toxic Intensity of Industrial Production: Global Patterns, Trends, and Trade Policy," American Economic Review, American Economic Association, vol. 82(2), pages 478-81, May.
  3. Josh Ederington & Jenny Minier, 2000. "Is Environmental Policy a Secondary Trade Barrier? An Empirical Analysis," Econometric Society World Congress 2000 Contributed Papers 1507, Econometric Society.
  4. Josh Ederington, Arik Levinson, and Jenny Minier, 2004. "Trade Liberalization and Pollution Havens," Working Papers gueconwpa~04-04-05, Georgetown University, Department of Economics.
  5. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
  6. Arik Levinson & M. Scott Taylor, 2008. "Unmasking The Pollution Haven Effect," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(1), pages 223-254, 02.
  7. Werner Antweiler & Brian R. Copeland & M. Scott Taylor, 1998. "Is Free Trade Good for the Environment?," NBER Working Papers 6707, National Bureau of Economic Research, Inc.
  8. David H. Romer & Jeffrey A. Frankel, 1999. "Does Trade Cause Growth?," American Economic Review, American Economic Association, vol. 89(3), pages 379-399, June.
  9. Eric J. Bartelsman & Wayne Gray, 1996. "The NBER Manufacturing Productivity Database," NBER Technical Working Papers 0205, National Bureau of Economic Research, Inc.
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