Trading partners, commodity structure, and environmental pollution | Chao Zhong

Field | Discipline

• Low-carbon economy
• Trade emissions
• Environmental Sciences

Expertise

• Measurement model
• Space measurement
• Input-output analysis

Summary

With the intensification of global pollution and the differences in economic, technological, and policy, the environment has had an unprecedented impact on the entire international economy and trade. China, as the largest trading nation, has long been exporting high-energy and resource-intensive products for other countries, while high environmental costs hidden behind such ultra-rapid international trade. The amount of this kind of hidden pollution is increasing with the blind expansion of China's trade scale, unreasonable trade structure and trade distribution, and China's domestic environmental pressure will be growing. How to identify the relationship among trading partners, commodity structure, and environmental pollution, then to reduce environmental pollution through rational trade methods and commodity structural optimization is of great significance to the current global pollution control pattern.

China's major trading partners have maintained relatively strong stability in the past. However, some changes have quietly occurred under the influence of various factors. This part attempts to analyze the changes in China's trade patterns and development trends with the changes of China's major trading partners, commodity structure and environmental pollution (CO2, SO2, NOx, PM2.5, etc). In my project, I will show how trade affects environmental pollution. The content will be conducted in the following aspects.

• Mechanism verification: trade and environmental pollution. Based on the research of Grossman and Krueger, many scholars have made a deeper study on the environmental effects of trade, such as the North-South trade model of Copeland & Taylor (1995) and the ACT model of Antweiler (2001). This study will explore the impact of trade on the environment based on an econometric model with a test of mediating effects for the effectiveness, such as scale effect, structural effect, technical effect, income effect.
• The impact of trade on environmental pollution. Trade scale and environmental pollution: The study plans to select 274 cities in China as a sample, using dynamic spatial panel models and GMM methods to study the impact of urban-level export trade on environmental pollution. Trade structure and environmental pollution: Based on the industrial enterprise database and China's customs data, this study intends to explore the impact of trade on China's environment from three different perspectives: primary product trade, processing trade, and service trade. On this basis, we may propose how China can reduce the negative effects on the environment and improve the positive effects with the sustainable trade development strategy.
• The response of trade to environmental pollution. I plan to use the analysis technique based on the vector autoregressive (VAR) system originally proposed by Sims (1980). Then, based on Granger test and Impulse Response, analyze the causality and parameter relationship between time series (environmental pollution and trade).
• Trading partners and environmental pollution. Based on commodity structure and trade distribution, this study intends to measure and analyze the environmental pollution flows between China and major trading partners, which is of great significance for the formulation of China's energy conservation policies and rational emission reduction obligations allocation in the post-Kyoto era.
• The role of environmental pollution in optimizing trade. Optimization of trade structure by environmental pollution:The rise in the cost of environmental factors may affect the transformation of export from pollution-intensive to environmentally friendly. In the process of globalization, the state can engage in large-scale specialized production, while changes in cost and factor structure due to the environment will also lead to the industrial structure changes and then trade structure. This study intends to select appropriate instrumental variables to reversely analyze the impact of environmental pollution on trade, including trade growth and structure. Optimization of environmental pollution to the layout of trading partners: Conversely, when the country's environmental regulations are more stringent, the environmental costs will increase with reducing the country's comparative advantage in export products. Based on the CGE or input-output model.

This study intends to analyze the impact of environmental pollution on the distribution of China's industrial landscape and trading partners through the impact simulation of environmental regulation.

Supervision by

• Promotor: Prof. dr. K.S. (Klaus) Hubacek | Integrated Research on Energy, Environment and Society - IREES | ESRIG, University of Groningen.
• Daily supervisor: Dr. Y. (Yuli) Shan | Integrated Research on Energy, Environment and Society - IREES | ESRIG, University of Groningen.

Contact details:

Energy Academy Europe, Nijeborgh 6, 9747 AG Groningen
Telephone | pending
E-mail | c.zhong rug.nl