The Pollution Haven Hypothesis: Significance and Insignificance

Ryan Kellogg

No 21191, 2006 Annual meeting, July 23-26, Long Beach, CA from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Theory and intuition tell us that the imposition of stringent environmental policies by a given country will reduce its net exports of commodities produced using pollution-intensive industries. It is therefore surprising that many empirical studies of international commodity trade have failed to find evidence of this effect. This study offers a new, highly focused test of the pollution haven hypothesis, by investigating the link between international factor trade in coal and urban air concentrations of SO2. I find statistically significant evidence that countries with poor air quality do have higher net factor exports of coal; however, the magnitude of the impact is small, casting doubt on the economic significance of the pollution haven effect as a guide to policy.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 32
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea06:21191

DOI: 10.22004/ag.econ.21191

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