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Trade and Specialisation in Pollution Intensive Industries: North-South Evidence

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  • A. K. M. Azhar
  • Robert J. R. Elliott

Abstract

The pollution haven hypothesis (PHH) and the capital-labour hypothesis (KLH) state that the relative level of a country's environmental regulations and capital and labour endowments determines its comparative advantage respectively. Since these hypotheses lead to conflicting predictions as to whether the North or the South will specialise in pollution-intensive production, this paper examines whether changes in trade and specialisation patterns allow us to distinguish between pollution haven and factor endowment effects. We employ a methodology that enables us to present North-South trade patterns over time and to identify those periods when trade patterns were consistent with either the PHH and/or the KLH as a foundation for undertaking more detailed econometric studies.

Suggested Citation

  • A. K. M. Azhar & Robert J. R. Elliott, 2007. "Trade and Specialisation in Pollution Intensive Industries: North-South Evidence," International Economic Journal, Taylor & Francis Journals, vol. 21(3), pages 361-380.
    • Handle: RePEc:taf:intecj:v:21:y:2007:i:3:p:361-380
    DOI: 10.1080/10168730701529926
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    References listed on IDEAS

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    1. 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, February.
    2. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249, January.
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    Cited by:

    1. Fozia Latif Gill & K Kuperan Viswanathan & Mohd Zaini Abdul Karim, 2018. "The Critical Review of the Pollution Haven Hypothesis (PHH)," International Journal of Energy Economics and Policy, Econjournals, vol. 8(1), pages 167-174.
    2. Roy, Jayjit, 2017. "On the environmental consequences of intra-industry trade," Journal of Environmental Economics and Management, Elsevier, vol. 83(C), pages 50-67.

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