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A reexamination of the role of income for the trade and environment debate

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  • Kellenberg, Derek K.

Abstract

Recent work on the relationship between international trade and the environment has found small but negative effects of increased openness on measures of pollution for the average country. On a panel of 128 countries it is shown that, like previous studies, the trade intensity effect is negative and significant for the average country for emissions of four localized pollutants (SO2, NOX, CO, and VOCs). However, trade intensity effects are not uniform across countries of different income levels. In fact, a strong non-monotonicity exists in trade intensity elasticities. It is found that countries with relative world incomes less than 0.5 or greater than 2.5 tend to have positive trade intensity elasticities, while countries with relative world incomes between 0.5 and 2.5 tend to have negative trade intensity elasticities. The results imply that both factor abundance and pollution haven effects may be at work, but that the dominance of one effect over the other depends on a country's level of development.

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Bibliographic Info

Article provided by Elsevier in its journal Ecological Economics.

Volume (Year): 68 (2008)
Issue (Month): 1-2 (December)
Pages: 106-115

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Handle: RePEc:eee:ecolec:v:68:y:2008:i:1-2:p:106-115

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Web page: http://www.elsevier.com/locate/ecolecon

Related research

Keywords: International trade Environment Pollution Globalization Developed nations Developing nations F18 Q53 Q56;

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References

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  1. Gene M. Grossman & Alan B. Krueger, 1991. "Environmental Impacts of a North American Free Trade Agreement," NBER Working Papers 3914, National Bureau of Economic Research, Inc.
  2. Florenz Plassmann & Neha Khanna, 2006. "Preferences, Technology, and the Environment: Understanding the Environmental Kuznets Curve Hypothesis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(3), pages 632-643.
  3. Maddison, David, 2006. "Environmental Kuznets curves: A spatial econometric approach," Journal of Environmental Economics and Management, Elsevier, vol. 51(2), pages 218-230, March.
  4. Judith M. Dean, 2002. "Does trade liberalization harm the environment? A new test," Canadian Journal of Economics, Canadian Economics Association, vol. 35(4), pages 819-842, November.
  5. Chintrakarn, Pandej & Millimet, Daniel, 2005. "The Environmental Consequences of Trade: Evidence from Subnational Trade Flows," Departmental Working Papers 0501, Southern Methodist University, Department of Economics.
  6. Cole, Matthew A., 2004. "Trade, the pollution haven hypothesis and the environmental Kuznets curve: examining the linkages," Ecological Economics, Elsevier, vol. 48(1), pages 71-81, January.
  7. Jeffrey A. Frankel & Andrew K. Rose, 2002. "Is Trade Good or Bad for the Environment? Sorting Out the Causality," NBER Working Papers 9201, National Bureau of Economic Research, Inc.
  8. 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.
  9. David H. Romer & Jeffrey A. Frankel, 1999. "Does Trade Cause Growth?," American Economic Review, American Economic Association, vol. 89(3), pages 379-399, June.
  10. Gawande, Kishore & Berrens, Robert P. & Bohara, Alok K., 2001. "A consumption-based theory of the environmental Kuznets curve," Ecological Economics, Elsevier, vol. 37(1), pages 101-112, April.
  11. Krishna Paudel & Hector Zapata & Dwi Susanto, 2005. "An Empirical Test of Environmental Kuznets Curve for Water Pollution," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 31(3), pages 325-348, 07.
  12. Hilton, F. G. Hank & Levinson, Arik, 1998. "Factoring the Environmental Kuznets Curve: Evidence from Automotive Lead Emissions," Journal of Environmental Economics and Management, Elsevier, vol. 35(2), pages 126-141, March.
  13. Cole, Matthew A. & Elliott, Robert J. R., 2003. "Determining the trade-environment composition effect: the role of capital, labor and environmental regulations," Journal of Environmental Economics and Management, Elsevier, vol. 46(3), pages 363-383, November.
  14. Rothman, Dale S., 1998. "Environmental Kuznets curves--real progress or passing the buck?: A case for consumption-based approaches," Ecological Economics, Elsevier, vol. 25(2), pages 177-194, May.
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Citations

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Cited by:
  1. Chang, Chun Ping & Berdiev, Aziz N., 2011. "The political economy of energy regulation in OECD countries," Energy Economics, Elsevier, vol. 33(5), pages 816-825, September.
  2. Frankel, Jeffrey, 2009. "Environmental Effects of International Trade," Working Paper Series rwp09-006, Harvard University, John F. Kennedy School of Government.
  3. Alassane DRABO, 2011. "Agricultural primary commodity export and environmental degradation: what consequences for population’s health?," Working Papers 201110, CERDI.
  4. Halkos, George & Tzeremes, Nickolaos, 2011. "A conditional full frontier modelling for analyzing environmental efficiency and economic growth," MPRA Paper 32839, University Library of Munich, Germany.
  5. Naughton, Helen Tammela, 2010. "Globalization and Emissions in Europe," MPRA Paper 27684, University Library of Munich, Germany.
  6. Per G. Fredriksson & Xenia Matschke, 2014. "Trade Liberalization and Environmental Taxation in Federal Systems," CESifo Working Paper Series 4717, CESifo Group Munich.
  7. Nicole A. MATHYS & Jaime de MELO, 2012. "Reconciling Trade and Climate Policies," Working Papers P37, FERDI.
  8. repec:laf:wpaper:201201 is not listed on IDEAS
  9. Louis Dupuy, 2012. "International Trade and Sustainability: A survey," Larefi Working Papers 1201, Larefi, Université Bordeaux 4.
  10. Kellenberg, Derek, 2012. "Trading wastes," Journal of Environmental Economics and Management, Elsevier, vol. 64(1), pages 68-87.

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