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Do Environmental Provisions in Preferential Trade Agreements Reduce Emissions Traded in Global Value Chains?
This paper examines whether preferential trade agreements (PTAs) increase emissions embodied in trade and considers whether environmental provisions in PTAs affect this relationship.
The results suggest PTAs are associated with increased emissions embodied in trade, mainly because of increased trade between PTA partners. The presence of an environmental provision in PTAs mitigates this effect, however, with environmental provisions reducing both the scale of trade and the emissions intensity of that trade.
The results suggest PTAs are associated with increased emissions embodied in trade, mainly because of increased trade between PTA partners. The presence of an environmental provision in PTAs mitigates this effect, however, with environmental provisions reducing both the scale of trade and the emissions intensity of that trade.
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