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Abstract

We examine the effects of China's trade liberalisation, post entry into the WTO, on the greenhouse-gas (GHG) emissions of its trading partners. Using complementary estimators we establish that China's liberalised trade had significant effects on the GHG emissions of its trading partners. Increased exposure to Chinese exports increased the growth of consumption-based emissions while reducing production-based emission. The increase in consumption-based emissions was larger than the decrease in production emissions. Consumption emissions increased both through a scale effect (consumption increased) and a composition effect (consumption became more emissions intensive). Decomposition analysis suggests that the link between exposure to Chinese exports and the increase consumption-based emissions is the emissions embodied in imports: The emissions embodied in imports increased and imports became more emissions intensive. The increase in imported emissions was not offset by a reduction in domestic production of emissions either in final consumption goods or exports.

Item Type:	Article
Authors/Creators:	Levitt, C and Saaby, M and Sorensen, A
Keywords:	greenhouse gas emissions, international trade, consumption emissions, production emissions
Journal or Publication Title:	China Economic Review
Publisher:	Elsevier Science Inc
ISSN:	1043-951X
DOI / ID Number:	10.1016/j.chieco.2018.10.012
Copyright Information:	Copyright 2018 Elsevier Inc.
Related URLs:	Google Scholar: Levitt, C UTAS Profile: Levitt, C
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