Working Paper: CEPR ID: DP14228
Authors: Rikard Forslid
Abstract: This paper analyzes the environmental impact of emissions related to trade and trans-portation. It is shown that transportation may in principle lower global emissions if theproduction sector is dirtier than the transport sector. The measure of a sector's dirtiness isrelated to the emissions taxes and the abatement efficiency within that sector. It is shownthat a firm's abatement efficiency can be calculated from the emission-to-cost ratio timesthe emissions tax. Using Swedish data to rank 5-digit industries in terms of their dirtinessreveals that several production sectors have a higher dirtiness index than transportationdoes.
Keywords: emissions; trade; transportation
JEL Codes: F10; F18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| international transportation (L93) | lower global emissions (F64) |
| production sector is dirtier than transport sector (L99) | international transportation leads to lower global emissions (R41) |
| emissions from transport sector (R41) | emissions from various production sectors (E23) |
| abatement efficiency of firms (Q52) | emissions-to-cost ratio multiplied by emissions tax (Q52) |
| higher dirtiness index of production sectors (L99) | lower global emissions when importing goods (F64) |
| trade (F19) | lower global CO2 emissions than local production (F64) |