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 changes in the composition of industries. Freer trade means greater specialization, increasing the concentration of polluting industries in some countries and decreasing it in others. Indeed, in this paper we predict a substantial reduction in U.S. pollution from 1972-94 due entirely to a shift in the composition of U.S. manufacturing toward cleaner industries. 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; we conclude that no such connection exists. First, we find that a shift toward cleaner industries, similar to that observed in U.S. manufacturing, has also occurred among U.S. imports. Second, we find no evidence that pollution-intensive industries have been disproportionately affected by the tariff changes over that time period.
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Paper provided by Georgetown University, Department of Economics in its series Working Papers with number
gueconwpa~04-04-05.
Length: Date of creation: Date of revision: Handle: RePEc:geo:guwopa:gueconwpa~04-04-05
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Find related papers by JEL classification: Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounting F18 - International Economics - - Trade - - - Trade and Environment
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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.
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