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Trade liberalization and the environment: Evidence from NAFTA and U.S. manufacturing

Jevan Cherniwchan

Journal of International Economics, 2017, vol. 105, issue C, 130-149

Abstract: The unobserved responses of individual polluters are often used to rationalize the aggregate effects of international trade on the environment. In this paper, I provide the first evidence of these responses. I estimate the effects of NAFTA on the emissions of particulate matter (PM10) and sulfur dioxide (SO2) from manufacturing plants in the United States. My findings suggest that trade liberalization led to significant reductions of these pollutants at affected plants. On average, nearly two-thirds of the reductions in PM10 and SO2 emissions from the U.S. manufacturing sector between 1994 and 1998 can be attributed to trade liberalization following NAFTA.

Keywords: NAFTA; Trade liberalization; Pollution emissions (search for similar items in EconPapers)
JEL-codes: F18 F14 Q56 (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:eee:inecon:v:105:y:2017:i:c:p:130-149