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The Impact of International Trade on Environmental Quality: Implications for Law

Author

Listed:
  • Pham Ngoc-Tham
  • Pham Trung-Kien

    (Faculty of Economics, Binh Duong University, Binh Duong Province590000, Vietnam)

  • Cao Viet Hieu

    (Binh Duong University, Binh Duong Province 590000, Vietnam)

  • Tran Ha Giang

    (Institute of Business Research, University of Economics Ho Chi Minh City, Ho Chi Minh City, Vietnam)

  • Vo Xuan Vinh

    () (Institute of Business Research and CFVG Ho Chi Minh City, University of Economics Ho Chi Minh City, 59C Nguyen Dinh Chieu Street, Ward 6, District 3, Ho Chi Minh City, Vietnam)

Abstract

Our study illuminates the impact of international trade on environmental quality in lower-middle-income countries by using CO2 emission as the proxy for environmental degradation. Using the Pooled Mean Group estimation along with validity tests, the results show that in the long run, CO2 emission is affected by merchandise export, merchandise import, FDI, GDP per capita, and renewable energy consumption. The impact of trade on CO2 emission is mixed because our findings show that merchandise export and import have opposite effects. In addition, our results reveal that Environmental Kuznets Curve exists in the long run with N-sharped. The increase in GDP per capita leads to the raise of CO2 emission at first, but later comes the decrease and then increase. The paper has relevant implications for law makers.

Suggested Citation

  • Pham Ngoc-Tham & Pham Trung-Kien & Cao Viet Hieu & Tran Ha Giang & Vo Xuan Vinh, 2020. "The Impact of International Trade on Environmental Quality: Implications for Law," Asian Journal of Law and Economics, De Gruyter, vol. 11(1), pages 1-12, April.
  • Handle: RePEc:bpj:ajlecn:v:11:y:2020:i:1:p:12:n:4
    DOI: 10.1515/ajle-2020-0001
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    References listed on IDEAS

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    More about this item

    Keywords

    CO2 emission; Environmental Kuznets Curve; export; import;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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