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Environmental regulation and international trade patterns for agro-industrial under a South-North Perspective

Author

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  • Feix, Rodrigo Daniel
  • Miranda, Silvia Helena Galvao de
  • Barros, Geraldo Sant'Ana de Camargo

Abstract

This paper aims at examining the relation between the international trade and the environment, particularly focused on sensitive agribusiness sectors. It consists on an empirical test to the conflicting positions supported by economists, some following the traditional approach (trade-off or neoclassical), while others supporting the Porter’s hypothesis, which considers that impacts of the stricter environmental regulation can benefit the trade competitiveness. A Heckscher-Ohlin- Vanek model was applied to net exports as the dependent variable. The agricultural products analyzed were total agriculture, rice, maize, soybean, wheat, dairy and swine; run for 97 countries, divided as developing and developed, in a cross-section approach. This modeling allows including the environmental endowment as explanatory variables. Moreover the Environmental Performance Index (Esty et al, 2008) was also tried as explanatory variables in order to catch any effect of the environmental regulation on the trade patterns. Results were not conclusively as they show that the net exports of the selected products, considered environmentally sensitive, can be affected even positively or negatively (neoclassical approach) by the environmental regulation. The results depend on the products. A remarkable outcome to highlight is that the dummy for developing countries and developed countries was significant, pointing that for rice, for example, it makes difference being a developing country, as well as it does for wheat, being a developed country.

Suggested Citation

  • Feix, Rodrigo Daniel & Miranda, Silvia Helena Galvao de & Barros, Geraldo Sant'Ana de Camargo, 2008. "Environmental regulation and international trade patterns for agro-industrial under a South-North Perspective," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44329, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae08:44329
    DOI: 10.22004/ag.econ.44329
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    References listed on IDEAS

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    1. Xu, Xinpeng, 1999. "Do Stringent Environmental Regulations Reduce the International Competitiveness of Environmentally Sensitive Goods? A Global Perspective," World Development, Elsevier, vol. 27(7), pages 1215-1226, July.
    2. Revesz, Richard L. & Stavins, Robert N., 2007. "Environmental Law," Handbook of Law and Economics, in: A. Mitchell Polinsky & Steven Shavell (ed.), Handbook of Law and Economics, edition 1, volume 1, chapter 8, pages 499-589, Elsevier.
    3. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
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    Cited by:

    1. Kiran Batool & Muhammad Adeel & Abdulhalim Musa Abubakar, 2024. "Unraveling the impact of energy demand and exports on environment and economy: A case study of South Asian Economies," Energy Technologies and Environment, Anser Press, vol. 2(3), pages 34-45, September.
    2. Nihal Ahmed & Zeeshan Hamid & Khalil Ur Rehman & Piotr Senkus & Nisar Ahmed Khan & Aneta Wysokińska-Senkus & Barbara Hadryjańska, 2023. "Environmental Regulation, Fiscal Decentralization, and Agricultural Carbon Intensity: A Challenge to Ecological Sustainability Policies in the United States," Sustainability, MDPI, vol. 15(6), pages 1-21, March.
    3. Li, Feiyang & Lin, Ziyue & Huang, Liangxiong & Yang, Caiting, 2022. "Environmental regulation and global value chain division position：Analysis based on global transnational data," Energy Policy, Elsevier, vol. 168(C).

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