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Offshoring Pollution: Is the United States Increasingly Importing Polluting Goods?

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  • Arik Levinson

Abstract

The question posed by the title of this article has been at the heart of debates about pollution havens, industrial flight to developing countries, and now carbon "leakage." Is the United States increasingly importing goods whose production generates relatively more pollution, rather than manufacturing those goods domestically? The consensus seems to be "yes," at least judging by the many public policies designed to counteract this offshoring of pollution. The evidence, however, is mixed, at least in part because empirical research has focused on a slightly different set of questions. After reviewing this research, I present a simple methodology for answering the specific question asked in the title. Using the World Bank's 1987 inventory of industry-specific U.S. air pollution emissions intensities, Bureau of Economic Analysis input--output tables, and data on U.S. imports, I show that from 1972 to 2001 the composition of U.S. imports shifted toward relatively clean goods, rather than polluting goods. Perhaps more surprising, this "green" shift of U.S. imports is even larger than the corresponding green shift of U.S. domestic manufacturing. Based on this analysis, the article concludes that over the past thirty years, the United States does not appear to have been offshoring pollution by importing polluting goods. Copyright 2010, Oxford University Press.

Suggested Citation

  • Arik Levinson, 2010. "Offshoring Pollution: Is the United States Increasingly Importing Polluting Goods?," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 4(1), pages 63-83, Winter.
  • Handle: RePEc:oup:renvpo:v:4:y:2010:i:1:p:63-83
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    Cited by:

    1. Duan, Yuwan & Jiang, Xuemei, 2017. "Temporal Change of China's Pollution Terms of Trade and its Determinants," Ecological Economics, Elsevier, vol. 132(C), pages 31-44.
    2. Lovely, Mary & Popp, David, 2011. "Trade, technology, and the environment: Does access to technology promote environmental regulation?," Journal of Environmental Economics and Management, Elsevier, vol. 61(1), pages 16-35, January.
    3. Levitt, Clinton J. & Pedersen, Morten S. & Sørensen, Anders, 2015. "Examining the efforts of a small, open economy to reduce carbon emissions: The case of Denmark," Ecological Economics, Elsevier, vol. 119(C), pages 94-106.
    4. Keisuke Kawata & Yasunori Ouchida, 2013. "Offshoring, trade and environmental policies: Effects of transboundary pollution," IDEC DP2 Series 3-8, Hiroshima University, Graduate School for International Development and Cooperation (IDEC).
    5. Grether, Jean-Marie & Mathys, Nicole A., 2013. "The pollution terms of trade and its five components," Journal of Development Economics, Elsevier, vol. 100(1), pages 19-31.
    6. Sato, Misato & Dechezleprêtre, Antoine, 2015. "Asymmetric industrial energy prices and international trade," Energy Economics, Elsevier, vol. 52(S1), pages 130-141.
    7. Stern, David I., 2014. "The Environmental Kuznets Curve: A Primer," Working Papers 249424, Australian National University, Centre for Climate Economics & Policy.
    8. Millimet, Daniel L., 2013. "Environmental Federalism: A Survey of the Empirical Literature," IZA Discussion Papers 7831, Institute for the Study of Labor (IZA).
    9. Xiaoyang Li & Yue Maggie Zhou, 2016. "Offshoring Pollution While Offshoring Production," Working Papers 16-09r, Center for Economic Studies, U.S. Census Bureau.
    10. Daniel L. Millimet & Jayjit Roy, 2011. "Three New Empirical Tests of the Pollution Haven Hypothesis When Environmental Regulation is Endogenous," Working Papers 11-10, Department of Economics, Appalachian State University.
    11. David I. Stern, 2017. "The environmental Kuznets curve after 25 years," Journal of Bioeconomics, Springer, vol. 19(1), pages 7-28, April.
    12. Gross, Christian, 2012. "Explaining the (non-) causality between energy and economic growth in the U.S.—A multivariate sectoral analysis," Energy Economics, Elsevier, vol. 34(2), pages 489-499.
    13. Arthur A. van Benthem, 2015. "Energy Leapfrogging," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 2(1), pages 93-132.
    14. repec:bla:stratm:v:38:y:2017:i:11:p:2310-2329 is not listed on IDEAS
    15. Dobes Leo & Jotzo Frank & Stern David I., 2014. "The Economics of Global Climate Change: A Historical Literature Review," Review of Economics, De Gruyter, vol. 65(3), pages 281-320, December.
    16. Pilkington, Brian & Roach, Richard & Perkins, James, 2011. "Relative benefits of technology and occupant behaviour in moving towards a more energy efficient, sustainable housing paradigm," Energy Policy, Elsevier, vol. 39(9), pages 4962-4970, September.
    17. Stern, David I., 2010. "The Role of Energy in Economic Growth," Working Papers 249380, Australian National University, Centre for Climate Economics & Policy.
    18. Antonietti, Roberto & Marzucchi, Alberto, 2014. "Green tangible investment strategies and export performance: A firm-level investigation," Ecological Economics, Elsevier, vol. 108(C), pages 150-161.
    19. Giulio Cainelli & Massimiliano Mazzanti & Roberto Zoboli, 2011. "Enviromental Innovations, Complementarity and Local/Global Cooperation," Working Papers 201104, University of Ferrara, Department of Economics.
    20. Marin, Giovanni & Mazzanti, Massimiliano & Montini, Anna, 2012. "Linking NAMEA and Input output for ‘consumption vs. production perspective’ analyses," Ecological Economics, Elsevier, vol. 74(C), pages 71-84.
    21. Matthew A. COLE & Robert R.J. ELLIOTT & OKUBO Toshihiro & Liyun ZHANG, 2017. "The Pollution Outsourcing Hypothesis: An empirical test for Japan," Discussion papers 17096, Research Institute of Economy, Trade and Industry (RIETI).
    22. Matthew Cole & Robert Elliott & Toshihiro Okubo, 2014. "International environmental outsourcing," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(4), pages 639-664, November.

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