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The effects of market integration on pollution: an analysis of EU enlargements

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  • Konstantin Sommer

    (University of Amsterdam)

  • Henri L.F. de Groot

    (Vrije Universiteit Amsterdam)

  • Franc Klaassen

    (University of Amsterdam)

Abstract

We study the effects of market integration on manufacturing emission intensities of CO2, SOx, and NOx. For this, we analyze the 2004 and 2007 EU enlargements in a sectoral panel with data on almost all EU member states from 1995 to 2015. We pay close attention to relevant channels of trade, regulation, and efficiency. Overall, the enlargements have resulted in a reduction of emission intensities in new member states: new regulations, which accession countries needed to adopt, have lowered pollution intensities strongly; induced improvements in productivity have further reduced them; and trade integration into the EU has had insignificant effects on emission intensities. We also do not find evidence of within-EU pollution haven effects and thus of leakage from old to new member states. For old members, trade integration, if anything, increased emission intensities, but productivity improvements have also contributed to cleaner manufacturing sectors here.

Suggested Citation

  • Konstantin Sommer & Henri L.F. de Groot & Franc Klaassen, 2022. "The effects of market integration on pollution: an analysis of EU enlargements," Tinbergen Institute Discussion Papers 22-039/VI, Tinbergen Institute, revised 21 Mar 2023.
    • Handle: RePEc:tin:wpaper:20220039
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    More about this item

    Keywords

    Market Integration; EU Enlargement; Carbon Leakage; Pollution Havens; Emission Intensity;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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