Advertisement

Environmental Economics and Policy Studies

, Volume 16, Issue 4, pp 305–324 | Cite as

The effect of trade openness on deforestation: empirical analysis for 142 countries

  • Tetsuya Tsurumi
  • Shunsuke Managi
Research Article Progress in Sustainable Development Economics

Abstract

This study explores the effect of trade openness on deforestation. Previous studies do not find a clear effect of trade openness on deforestation. We use updated data on the annual rate of deforestation for 142 countries from 1990 to 2003, treat trade and income as endogenous, and take into consideration an adjustment process by applying a dynamic model. We find that an increase in trade openness increases deforestation for non-OECD countries while slowing down deforestation for OECD countries. There is a possibility that both capital–labor and environmental-regulation effects have a negative impact on deforestation in developing countries, whereas the opposite holds in developed countries.

Keywords

Trade openness Environment Comparative advantage Deforestation 

JEL Classification

Q23 Q56 Q58 

Notes

Acknowledgments

We are grateful to the editor and the anonymous reviewer for valuable comments and suggestions.

References

  1. Allen J-C, Barnes D-F (1985) The causes of deforestation in developing countries. Ann Assoc Am Geogr 75:163–184CrossRefGoogle Scholar
  2. Antweiler W, Copeland B, Taylor S (2001) Is free trade good for the environment? Am Econ Rev 91:877–908CrossRefGoogle Scholar
  3. Arcand J, Guillaumont P, Jeanneney S-G (2008) Deforestation and the real exchange rate. J Dev Econ 86:242–262CrossRefGoogle Scholar
  4. Bhattarai M, Hammig M (2001) Institutions and the environmental Kuznets curve for deforestation: a cross-country analysis for Latin America, Africa and Asia. World Dev 29:995–1010CrossRefGoogle Scholar
  5. Chen X, Nordhaus W (2011) Using luminosity data as a proxy for economic statistics. Proc Natl Acad Sci USA 108(21):8589–8594CrossRefGoogle Scholar
  6. Cropper M, Griffiths C (1994) The interaction of population growth and environmental quality. Am Econ Rev 82:250–254Google Scholar
  7. Culas R-J (2007) Deforestation and the environmental Kuznets curve: an institutional perspective. Ecol Econ 61:429–437CrossRefGoogle Scholar
  8. FAO (2010) Global forest resources assessment 2010. Food and Agriculture Organization of the United Nations, RomeGoogle Scholar
  9. Frankel J, Rose A (2005) Is trade good or bad for the environment? Sorting out the causality. Rev Econ Stat 87:85–91CrossRefGoogle Scholar
  10. Grainger A (2008) Difficulties in tracking the long-term global trend in tropical forest area. Proc Natl Acad Sci USA 105:818–823CrossRefGoogle Scholar
  11. Hastie T-J, Tibshirani R-J (1990) Generalized additive models. Chapman and Hall, New YorkGoogle Scholar
  12. Intergovernmental Panel on Climate Change (IPCC) (2007) Climate change 2007: synthesis report. Contribution of working groups I, II and II to the fourth assessment report of the intergovernmental panel on climate change. IPCC, GenevaGoogle Scholar
  13. Lopez R (1994) The environment as a factor of production: the effects of economic growth and trade liberalization. J Environ Econ Manag 27:163–184CrossRefGoogle Scholar
  14. Managi S, Hibiki A, Tsurumi T (2009) Does trade openness improve environmental quality? J Environ Econ Manag 58:346–363CrossRefGoogle Scholar
  15. Panayotou T (1997) Demystifying the environmental Kuznets curve: turning a black box into a policy tool. Environ Dev Econ 2:465–484CrossRefGoogle Scholar
  16. Ridder R-H (2007) Global forest resource assessment 2010—options and recommendations for a global remote sensing survey of forests. FRA Working Paper 141, Food and Agriculture Organization of the United Nations, RomeGoogle Scholar
  17. Rudel T-K, Coomes O-T, Moran E, Achard F, Angelsen A, Xu J, Lambin E (2005) Forest transitions: towards a global understanding of land use change. Glob Environ Chang 15:23–31CrossRefGoogle Scholar
  18. Tsurumi T, Managi S (2010) Decomposition of the environmental Kuznets curve: scale, technique, and composition effects. Environ Econ Policy Stud 11:19–36CrossRefGoogle Scholar
  19. Van P-N, Azomahou T (2007) Nonlinearities and heterogeneity in environmental quality: an empirical analysis of deforestation. J Dev Econ 84:291–309CrossRefGoogle Scholar
  20. Wood S-N (2004) Stable and efficient multiple smoothing parameter estimation for generalized additive models. J Am Stat Assoc 99:673–686CrossRefGoogle Scholar
  21. Wood S-N (2008) Fast stable direct fitting and smoothness selection for generalized additive models. J R Stat Soc Ser B 70:495–518CrossRefGoogle Scholar
  22. World Bank (2003) World development report 2003: sustainable development in a dynamic world. Oxford University Press, New YorkCrossRefGoogle Scholar
  23. World Bank (2010) World development report 2010: development and climate change. Oxford University Press, New YorkCrossRefGoogle Scholar

Copyright information

© Springer Japan 2012

Authors and Affiliations

  1. 1.Faculty of Policy StudiesNanzan UniversitySetoJapan
  2. 2.Graduate School of Environmental StudiesTohoku UniversitySendaiJapan
  3. 3.Institute for Global Environmental StrategiesHayamaJapan

Personalised recommendations