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International production fragmentation, trade in intermediate goods and environment

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  • Zhang, Jingjing

Abstract

This paper examines the implications of growing international production fragmentation-induced trade in intermediate goods on environmental quality. Specifically, by making use of a general equilibrium framework, this paper explores the link between trade in intermediate goods and pollution in a setting of endogenous environmental policy. The paper shows that international trade in intermediate goods, through an increase in the number of components available to the international producers, affects the level of pollution and environmental quality. Specifically, developed countries may reduce pollution at the cost of more pollution in developing countries.

Suggested Citation

  • Zhang, Jingjing, 2020. "International production fragmentation, trade in intermediate goods and environment," Economic Modelling, Elsevier, vol. 87(C), pages 1-7.
    • Handle: RePEc:eee:ecmode:v:87:y:2020:i:c:p:1-7
    DOI: 10.1016/j.econmod.2019.06.015
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    Cited by:

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    2. Ibrahim, Ridwan Lanre & Ajide, Kazeem Bello, 2021. "The dynamic heterogeneous impacts of nonrenewable energy, trade openness, total natural resource rents, financial development and regulatory quality on environmental quality: Evidence from BRICS econo," Resources Policy, Elsevier, vol. 74(C).
    3. Xu, Zhiwei & Wen, Qiang & Zhang, Teng, 2023. "Trade policy and air pollution: Evidence from the adjustment of the export tax rebate in China," Economic Modelling, Elsevier, vol. 128(C).

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    More about this item

    Keywords

    International production fragmentation; Intermediate goods trade; Endogenous environmental policy; Environmental quality;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment

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