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Contribution to Book
How CO2 Emissions are influenced by Scale, Composition and Technique Effects? Empirical Evidences from Panel Data Analysis
Trade, Investment and Economic Development in Asia: Empirical and policy issues (2016)
  • Sacchidananda Mukherjee, National Institute of Public Finance and Policy, New Delhi
  • Debashis Chakraborty, Indian Institute of Foreign Trade
Abstract
The recent times has witnessed a simultaneous rise in both trade and investment flows and climate change concerns, mainly through three channels. First, rise in production and exports may necessitate greater use of energy products to sustain the economic activities, thereby leading to higher emissions (scale effect). Secondly, if the economic structure of a country changes through specialization in polluting sectors, greater emissions and other similar adverse environmental consequences may follow (composition effect). Finally, if with rise in income the economy gradually moves towards enactment of emission abatement standards and stronger regulatory policies to contain the adverse environmental effects of growth, a more sustainable scenario may evolve (technique effect). The present analysis intends to identify the influence of these three effects on per capita CO2 emissions, through panel data analysis for 181 countries over 1980-2009. The empirical findings confirm that while both in case of lower and higher income countries higher merchandise trade orientation leads to higher per capita CO2 emission, an opposite effect follows in case of service trade orientation. The empirical results confirm the adverse influences of merchandise trade flows on per capita CO2 emission pattern across countries through composition, scale and technology effects.
Keywords
  • environment and trade,
  • CO2 emissions,
  • per capita GDP,
  • capital intensity,
  • human development,
  • democracy.
Publication Date
June 7, 2016
Editor
D. Chakraborty and J. Mukherjee
Publisher
Routledge
ISBN
9781138962439
Citation Information
Sacchidananda Mukherjee and Debashis Chakraborty. "How CO2 Emissions are influenced by Scale, Composition and Technique Effects? Empirical Evidences from Panel Data Analysis" U.K. & U.S.A.Trade, Investment and Economic Development in Asia: Empirical and policy issues (2016) p. 282 - 300
Available at: http://works.bepress.com/sacchidananda_mukherjee/85/