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CO2 embedded in trade: trends and fossil fuel drivers

Author

Listed:
  • Sylvain Weber

    (University of Neuchâtel)

  • Reyer Gerlagh

    (Tilburg University)

  • Nicole A. Mathys

    (Federal Office for Spatial Development and University of Neuchâtel)

  • Daniel Moran

    (Norwegian University of Science and Technology)

Abstract

The amount of CO2 embedded in trade has substantially increased since 1990. We study the trends and some drivers over the period 1995-2009. We find that traded goods tend to have higher emission-intensities compared to average final demand. The second finding is that independently of sector structure, dirty countries tend to specialize in emissionintensive sectors. This finding suggests a comparative advantage mechanism for CO2 and lends support to the hypothesis that trade liberalization tends to increase global emissions. The third finding is that, on average, emission-intensive countries have shifted from trade deficits to surpluses, so a larger share of goods is now produced in emission-intensive countries, consequently increasing global emissions. Finally, our analysis points to coal abundance as an important driver for high levels of both domestic emissions per value added and Sector specialization into emission-intensive sectors. Hence coal abundance is an important driver of net CO2 exports.

Suggested Citation

  • Sylvain Weber & Reyer Gerlagh & Nicole A. Mathys & Daniel Moran, 2017. "CO2 embedded in trade: trends and fossil fuel drivers," Development Working Papers 413, Centro Studi Luca d'Agliano, University of Milano, revised 21 Feb 2017.
  • Handle: RePEc:csl:devewp:413
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    References listed on IDEAS

    as
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    Cited by:

    1. Arik Levinson, 2017. "Energy Intensity: Prices, Policy, or Composition in US States," Development Working Papers 414, Centro Studi Luca d'Agliano, University of Milano, revised 21 Feb 2017.

    More about this item

    Keywords

    CO2 embedded in trade; fossil fuel;

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models

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