The Effectiveness of Environmental Provisions in Regional Trade Agreements

Ryan Michael Abman, Clark Christopher Lundberg and Michele Ruta

No 9601, Policy Research Working Paper Series from The World Bank

Abstract: Trade liberalization can spur environmental degradation. Concerns over these adverse impacts have led to a debate over the need for environmental provisions in regional trade agreements (RTAs), however the effectiveness of such provisions is unknown. This paper provides new causal evidence that environmental provisions are effective in limiting deforestation following the entry into force of RTAs. It exploits high-resolution, satellite-derived estimates of deforestation and identify the content of RTAs using a new dataset with detailed information on individual provisions. Accounting for the potential endogeneity of environmental provisions in RTAs, the paper finds that the inclusion of specific provisions aimed at protecting forests and/or biodiversity entirely offsets the net increases in forest loss observed in similar RTAs without such provisions. The inclusion of these provisions limits agricultural land expansion, but does not completely offset increases in total agricultural production. The effects are concentrated in tropical, developing countries with greater biodiversity.

Keywords: International Trade and Trade Rules; Environmental Disasters&Degradation; Global Environment Facility; Biodiversity; Trade Policy (search for similar items in EconPapers)
Date: 2021-03-25
New Economics Papers: this item is included in nep-agr, nep-env and nep-int
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Citations: View citations in EconPapers (6)

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Related works:
Journal Article: The Effectiveness of Environmental Provisions in Regional Trade Agreements (2024)
Working Paper: The Effectiveness of Environmental Provisions in Regional Trade Agreements (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:9601

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