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      Is environmental efficiency trade inducing or trade hindering?

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      Author
      Doganay, S. M.
      Sayek, S.
      Taskin, F.
      Date
      2014
      Source Title
      Energy Economics
      Print ISSN
      0140-9883
      Electronic ISSN
      1873-6181
      Publisher
      Elsevier
      Volume
      44
      Pages
      340 - 349
      Language
      English
      Type
      Article
      Item Usage Stats
      131
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      Abstract
      Global efforts to identify strategies for sustainable economic growth and development underline the need for understanding important links between environmental policies and international trade. In this paper, by constructing an environmental efficiency index for 111 countries from 1980 to 2009, we are able to empirically test for one such link. An improvement in the environmental efficiency index in terms of carbon dioxide emissions reflects a decrease in the cost of efforts to mitigate the environmental costs associated with growth. Countries that improve their environmental efficiency are found to experience strong international trade effects, both through increased exports and increased imports. While the positive link between efficiency improvements and exports is supportive of the Porter hypothesis, the positive link between efficiency improvements and imports is supportive of strong positive income effects on account of environmental efforts. These results, which are robust to alternative estimation strategies, lend strong support to global efforts to improve countries' environmental efficiencies. © 2014 Elsevier B.V.
      Keywords
      Environmental efficiency index
      Gravity model
      Porter hypothesis
      Carbon dioxide
      Economic analysis
      Global warming
      International trade
      Environmental efficiency
      F14
      F18
      Gravity model
      Porter hypothesis
      Efficiency
      Permalink
      http://hdl.handle.net/11693/26599
      Published Version (Please cite this version)
      http://dx.doi.org/10.1016/j.eneco.2014.04.004
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      • Department of Economics 649
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