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WTO accession, trade expansion, and air pollution: Evidence from China’s county‐level panel data
Author(s) -
Chen Shuai,
Lin Faqin,
Yao Xi,
Zhang Peng
Publication year - 2020
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/roie.12480
Subject(s) - china , accession , panel data , international trade , pollution , economics , international economics , bilateral trade , air pollution , trade barrier , exploit , geography , econometrics , european union , ecology , chemistry , computer security , archaeology , organic chemistry , computer science , biology
This study provides evidence that trade expansion has contributed to the degradation of air pollution in China. On the basis of different responses of counties’ trade to China's World Trade Organization accession at the end of 2001, we exploit air pollution data from NASA to construct a difference‐in‐differences predicted trade as an instrument for our identification. We document statistically significant and robust evidence on trade expansion, which accounts for approximately 60% and 20% for the increase of PM 2.5 and SO 2 , respectively, in China. Findings on trade pollution relation are robust to various tests. Deterioration in the environment is mainly driven by scale and trade in polluting sectors.