The Effect of Trade Openness on Deforestation: Empirical Analysis for 142 Countries
AbstractThis study explores the effect of trade openness on deforestation. Previous studies do not find a clear effect of trade openness on deforestation. We use updated data on the annual rate of deforestation for 142 countries from 1990 to 2003, treat trade and income as endogenous, and take into consideration an adjustment process by applying a dynamic model. We find that an increase in trade openness increases deforestation for non-OECD countries while slowing down deforestation for OECD countries. There is a possibility that both capital-labor and environmental-regulation effects have a negative impact on deforestation in developing countries, whereas the opposite holds in developed countries.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 35805.
Date of creation: 30 Dec 2011
Date of revision:
Trade Openness; Environment; Comparative Advantage; Deforestation;
Find related papers by JEL classification:
- Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
- F10 - International Economics - - Trade - - - General
This paper has been announced in the following NEP Reports:
- NEP-AGR-2012-01-18 (Agricultural Economics)
- NEP-ALL-2012-01-18 (All new papers)
- NEP-ENV-2012-01-18 (Environmental Economics)
- NEP-INT-2012-01-18 (International Trade)
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