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Measuring the Environmental Impacts of Changing Trade Patterns on the Poor

  • Kalirajan, Kaliappa

    (Asian Development Bank Institute)

  • Anbumozhi, Venkatachalam

    (Asian Development Bank Institute)

  • Singh, Kanhaiya

    (Asian Development Bank Institute)

It is an empirical fact that it is very difficult to balance economic growth, poverty reduction, and environment protection, particularly for developing and transitional economies. While the economic environment of a country is influenced by conditions within the country, it is also influenced by external shocks such as the recent global financial crisis depending on how integrated the country is with the rest of the world. Thus, it poses a continuing challenge for policy makers in developing and transitional countries to readjust the economic environment in a way that leads to better and more effective targeting of the chronic issue of poverty reduction without causing damage to the natural environment. It is in this context that this paper attempts to measure the environmental impact of changing trade patterns on the poor. The recent financial crisis has discouraged United States (US) private consumption, which in turn has significantly reduced exports from Asia. However, Asia’s private consumption is at a very low level even when compared with the current reduced US private consumption. Therefore, it is possible for Asian countries to focus more on improving regional trade and domestic consumption to compensate for the revenue losses that resulted from the reduction in global demand. This paper argues that energy-efficient production methods and service-led growth, particularly trade in environmental goods and services, provide good opportunities for Asian countries to enjoy “inclusive growth” without damaging the natural environment.

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Paper provided by Asian Development Bank Institute in its series ADBI Working Papers with number 239.

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Length: 27 pages
Date of creation: 11 Aug 2010
Date of revision:
Handle: RePEc:ris:adbiwp:0239
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  1. Maxime Kennett & Ronald Steenblik, 2005. "Environmental Goods and Services: A Synthesis of Country Studies," OECD Trade and Environment Working Papers 2005/3, OECD Publishing.
  2. World Bank, 2007. "Warming Up to Trade? Harnessing International Trade to Support Climate Change Objectives," World Bank Other Operational Studies 7749, The World Bank.
  3. Amiti, Mary & Freund, Caroline, 2008. "The anatomy of China's export growth," Policy Research Working Paper Series 4628, The World Bank.
  4. Ronald Steenblik & Dominique Drouet & George Stubbs, 2005. "Synergies Between Trade in Environmental Services and Trade in Environmental Goods," OECD Trade and Environment Working Papers 2005/1, OECD Publishing.
  5. Copeland, Brian R & Taylor, M Scott, 1995. "Trade and Transboundary Pollution," American Economic Review, American Economic Association, vol. 85(4), pages 716-37, September.
  6. Reimer, Jeffrey J., 2002. "Estimating the Poverty Impacts of Trade Liberalization," GTAP Working Papers 1163, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
  7. Ronald Steenblik, 2005. "Liberalising Trade in 'Environmental Goods': Some Practical Considerations," OECD Trade and Environment Working Papers 2005/5, OECD Publishing.
  8. Masahiro Kawai, 1998. "The East Asian Currency Crisis: Causes And Lessons," Contemporary Economic Policy, Western Economic Association International, vol. 16(2), pages 157-172, 04.
  9. Mary Amiti & Shang-Jin Wei, 2006. "Service Offshoring and Productivity: Evidence from the United States," NBER Working Papers 11926, National Bureau of Economic Research, Inc.
  10. Wunsch-Vincent, Sacha, 2009. "Opening Markets for International Trade in Services: Countries and Sectors in Bilateral and WTO Negotiations edited by Juan A. Marchetti and Martin Roy Cambridge University Press, 2009," World Trade Review, Cambridge University Press, vol. 8(04), pages 619-622, October.
  11. Geoffrey J. Bannister, 2001. "International Trade and Poverty Alleviation," IMF Working Papers 01/54, International Monetary Fund.
  12. Karsten Bjerring Olsen, 2006. "Productivity Impacts of Offshoring and Outsourcing: A Review," OECD Science, Technology and Industry Working Papers 2006/1, OECD Publishing.
  13. Ronald Steenblik, 2005. "Environmental Goods: A Comparison of the APEC and OECD Lists," OECD Trade and Environment Working Papers 2005/4, OECD Publishing.
  14. Ravallion, Martin & Datt, Gaurav, 1996. "How Important to India's Poor Is the Sectoral Composition of Economic Growth?," World Bank Economic Review, World Bank Group, vol. 10(1), pages 1-25, January.
  15. Ross Garnaut & Stephen Howes & Frank Jotzo & Peter Sheehan, 2008. "Emissions in the Platinum Age: the implications of rapid development for climate-change mitigation," Oxford Review of Economic Policy, Oxford University Press, vol. 24(2), pages 377-401, Summer.
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