IDEAS home Printed from https://ideas.repec.org/a/sae/smppub/v3y2014i2p221-239.html
   My bibliography  Save this article

Climate Change: An Emerging Trade Opportunity in South Asia

Author

Listed:
  • Soumyananda Dinda

    (Soumyananda Dinda, Department of Economics, Golapbag, Burdwan University, Burdwan, 713104, West Bengal, India. E-mails: sdinda2000@yahoo.co.in; s_dinda@hotmail.com)

Abstract

This article investigates emerging opportunities in climate change mitigation in South Asia through trade. Trade can mitigate the climate change issues of a country, region or the world as a whole. Through international agreement (or pressure), trade also creates the opportunity for green jobs that produce environment-friendly goods (EFG), which have less damaging impact on environment. This article examines possible potential trade opportunity of climate-friendly goods (CFG) in South Asia. Applying the gravity model, this article estimates potential trade of CFG in South Asia. It also measures the trade gap as to how well bilateral trade flow performs relative to the mean value of trade as predicted by the model. Here, ‘potential trade gap’ means the gap between actual trade and the predicted trade value. It suggests that there is a scope to improve the export of CFG with trading partners. This article suggests and also highlights an alternative possibility for a climate-friendly export-led growth model in South Asia. It also identifies the potential trade gap of CFG for each regional member and its partners within region and developed countries such as the European Union (EU) and North America (the USA and Canada). JEL Classifications: Q5, C23, F1

Suggested Citation

  • Soumyananda Dinda, 2014. "Climate Change: An Emerging Trade Opportunity in South Asia," South Asian Journal of Macroeconomics and Public Finance, , vol. 3(2), pages 221-239, December.
  • Handle: RePEc:sae:smppub:v:3:y:2014:i:2:p:221-239
    DOI: 10.1177/2277978714548636
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/2277978714548636
    Download Restriction: no

    File URL: https://libkey.io/10.1177/2277978714548636?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Soumyananda Dinda, 2011. "Trade Opportunities for Climate Smart Goods and Technologies in Asia," Working Papers 2011/16, Maastricht School of Management.
    2. Jeffrey A. Frankel, 1998. "The Regionalization of the World Economy," NBER Books, National Bureau of Economic Research, Inc, number fran98-1, February.
    3. Brian R. Copeland & M. Scott Taylor, 2004. "Trade, Growth, and the Environment," Journal of Economic Literature, American Economic Association, vol. 42(1), pages 7-71, March.
    4. Baldwin, Richard & Taglioni, Daria, 2006. "Gravity for Dummies and Dummies for Gravity Equations," CEPR Discussion Papers 5850, C.E.P.R. Discussion Papers.
    5. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 691-751, September.
    6. Werner Antweiler & Brian R. Copeland & M. Scott Taylor, 2001. "Is Free Trade Good for the Environment?," American Economic Review, American Economic Association, vol. 91(4), pages 877-908, September.
    7. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
    8. Leamer, Edward E. & Levinsohn, James, 1995. "International trade theory: The evidence," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 26, pages 1339-1394, Elsevier.
    9. James Harrigan, 2001. "Specialization and the Volume of Trade: Do the Data Obey the Laws?," NBER Working Papers 8675, National Bureau of Economic Research, Inc.
    10. Rauch, James E., 1999. "Networks versus markets in international trade," Journal of International Economics, Elsevier, vol. 48(1), pages 7-35, June.
    11. James R. Markusen, 2021. "Putting per-capita income back into trade theory," World Scientific Book Chapters, in: BROADENING TRADE THEORY Incorporating Market Realities into Traditional Models, chapter 10, pages 187-197, World Scientific Publishing Co. Pte. Ltd..
    12. Jeffrey A. Frankel, 1997. "Regional Trading Blocs in the World Economic System," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 72, October.
    13. Deardorff, Alan V., 1984. "Testing trade theories and predicting trade flows," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 10, pages 467-517, Elsevier.
    14. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-623, June.
    15. Balassa, Bela & Bauwens, Luc, 1987. "Intra-industry Specialisation in a Multi-country and Multi-industry Framework," Economic Journal, Royal Economic Society, vol. 97(388), pages 923-939, December.
    16. Alan V. Deardorff, 2011. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 24, pages 267-293, World Scientific Publishing Co. Pte. Ltd..
    17. Peter Egger, 2002. "An Econometric View on the Estimation of Gravity Models and the Calculation of Trade Potentials," The World Economy, Wiley Blackwell, vol. 25(2), pages 297-312, February.
    18. Barry Eichengreen & Douglas A. Irwin, 1998. "The Role of History in Bilateral Trade Flows," NBER Chapters, in: The Regionalization of the World Economy, pages 33-62, National Bureau of Economic Research, Inc.
    19. Judith M. Dean & Mary E. Lovely & Hua Wang, 2017. "Are foreign investors attracted to weak environmental regulations? Evaluating the evidence from China," World Scientific Book Chapters, in: Mary E Lovely (ed.), International Economic Integration and Domestic Performance, chapter 9, pages 155-167, World Scientific Publishing Co. Pte. Ltd..
    20. Anne-Célia Disdier & Keith Head, 2008. "The Puzzling Persistence of the Distance Effect on Bilateral Trade," The Review of Economics and Statistics, MIT Press, vol. 90(1), pages 37-48, February.
    21. Liddle, Brantley, 2001. "Free trade and the environment-development system," Ecological Economics, Elsevier, vol. 39(1), pages 21-36, October.
    22. Coondoo, Dipankor & Dinda, Soumyananda, 2002. "Causality between income and emission: a country group-specific econometric analysis," Ecological Economics, Elsevier, vol. 40(3), pages 351-367, March.
    23. Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
    24. Helpman, Elhanan, 1987. "Imperfect competition and international trade: Evidence from fourteen industrial countries," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 62-81, March.
    25. G. M. Grossman & K. Rogoff (ed.), 1995. "Handbook of International Economics," Handbook of International Economics, Elsevier, edition 1, volume 3, number 3.
    26. Nilsson, Lars, 2000. "Trade integration and the EU economic membership criteria," European Journal of Political Economy, Elsevier, vol. 16(4), pages 807-827, November.
    27. Dinda, Soumyananda, 2011. "Climate Change and Development: Trade Opportunities of Climate Smart Goods and Technologies in Asia," MPRA Paper 34883, University Library of Munich, Germany, revised Nov 2011.
    28. Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-116, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dinda, Soumyananda, 2018. "Climate Friendly Goods and Technology Trade: Climate Mitigation Strategy of India," MPRA Paper 93031, University Library of Munich, Germany, revised 2018.
    2. Dinda, Soumyananda, 2018. "Growing Potential Business opportunity for Climate Friendly Goods and Technologies in Asia since 1997," MPRA Paper 93238, University Library of Munich, Germany, revised 2018.
    3. Dinda, Soumyananda, 2011. "Climate Change, Trade, and Competitiveness: Climate Trade Performance of India, SAARC and Asia Pacific Region," MPRA Paper 59423, University Library of Munich, Germany, revised 17 Aug 2014.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dinda, Soumyananda, 2018. "Climate Friendly Goods and Technology Trade: Climate Mitigation Strategy of India," MPRA Paper 93031, University Library of Munich, Germany, revised 2018.
    2. Dinda, Soumyananda, 2018. "Growing Potential Business opportunity for Climate Friendly Goods and Technologies in Asia since 1997," MPRA Paper 93238, University Library of Munich, Germany, revised 2018.
    3. Dinda, Soumyananda, 2013. "Climate Change Creates Trade Opportunity in India," MPRA Paper 50636, University Library of Munich, Germany, revised 14 Oct 2013.
    4. Shiro Armstrong, 2007. "Measuring Trade and Trade Potential: A Survey," Asia Pacific Economic Papers 368, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.
    5. Dinda, Soumyananda, 2011. "Climate Change and Development: Trade Opportunities of Climate Smart Goods and Technologies in Asia," MPRA Paper 34883, University Library of Munich, Germany, revised Nov 2011.
    6. Dinda, Soumyananda, 2011. "Climate Change, Trade, and Competitiveness: Climate Trade Performance of India, SAARC and Asia Pacific Region," MPRA Paper 59423, University Library of Munich, Germany, revised 17 Aug 2014.
    7. Magerman, Glenn & Studnicka, Zuzanna & Van Hove, Jan, 2016. "Distance and border effects in international trade: A comparison of estimation methods," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 10, pages 1-31.
    8. Cafiso, Gianluca, 2007. "The Geographic Space in International Trade: from Gravity to New Economic Geography," MPRA Paper 20269, University Library of Munich, Germany.
    9. Michele Fratianni & Francesco Marchionne, 2011. "The Limits to Integration," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume I, chapter 9, Edward Elgar Publishing.
    10. Mr. Rikhil Bhavnani & Ms. Natalia T. Tamirisa & Mr. Arvind Subramanian & Mr. David T. Coe, 2002. "The Missing Globalization Puzzle," IMF Working Papers 2002/171, International Monetary Fund.
    11. Keith Head & Thierry Mayer, 2013. "What separates us? Sources of resistance to globalization," Canadian Journal of Economics, Canadian Economics Association, vol. 46(4), pages 1196-1231, November.
    12. Michele Fratianni & Francesco Marchionne, 2008. "Heterogeneity In Trade Costs," Economics Bulletin, AccessEcon, vol. 6(48), pages 1-14.
    13. Jan Möhlmann & Sjef Ederveen & Henri L.F. de Groot & Gert-Jan M. Linders, 2009. "Intangible Barriers to International Trade: A Sectoral Approach," Tinbergen Institute Discussion Papers 09-021/3, Tinbergen Institute.
    14. Gabriel J Felbermayr & Wilhelm Kohler, 2014. "Exploring the Intensive and Extensive Margins of World Trade," World Scientific Book Chapters, in: European Economic Integration, WTO Membership, Immigration and Offshoring, chapter 4, pages 115-148, World Scientific Publishing Co. Pte. Ltd..
    15. repec:ebl:ecbull:v:6:y:2008:i:48:p:1-14 is not listed on IDEAS
    16. Shumilov, Andrei, 2016. "Особенности Оценивания Гравитационных Моделей Международной Торговли [Estimating Gravity Models of International Trade: A Survey]," MPRA Paper 75371, University Library of Munich, Germany.
    17. Zwinkels, Remco C.J. & Beugelsdijk, Sjoerd, 2010. "Gravity equations: Workhorse or Trojan horse in explaining trade and FDI patterns across time and space?," International Business Review, Elsevier, vol. 19(1), pages 102-115, February.
    18. Scott L. Baier & Amanda Kerr & Yoto V. Yotov, 2018. "Gravity, distance, and international trade," Chapters, in: Bruce A. Blonigen & Wesley W. Wilson (ed.), Handbook of International Trade and Transportation, chapter 2, pages 15-78, Edward Elgar Publishing.
    19. Co, Catherine Yap, 2010. "Intra- and inter-firm US trade," International Review of Economics & Finance, Elsevier, vol. 19(2), pages 260-277, April.
    20. repec:hal:spmain:info:hdl:2441/443fbihfmj8h58a4ceedn30ogb is not listed on IDEAS
    21. Gert-Jan M. Linders & Henri L.F. de Groot & Raymond J.G.M. Florax & Peter Nijkamp, 2011. "Persistent Distance Decay Effects in International Trade," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume II, chapter 14, Edward Elgar Publishing.
    22. Head, Keith & Mayer, Thierry, 2014. "Gravity Equations: Workhorse,Toolkit, and Cookbook," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 131-195, Elsevier.

    More about this item

    Keywords

    Bilateral trade flow; climate-friendly goods; EFG; CFG; export; India; trade opportunity; climate change; gravity model; potential trade gap; South Asia; SAARC;
    All these keywords.

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F1 - International Economics - - Trade

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:smppub:v:3:y:2014:i:2:p:221-239. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.