We examine variations in the South–North ratios (emerging vs. industrialized countries) of energy and labor intensities driven by imports. We use the novel World input-output database that provides bilateral and bisectoral data for 40 countries and 35 sectors for 1995–2009. We find South–North convergence of energy and labor intensities, an energy bias of import-driven convergence and no robust difference between imports of intermediate and investment goods. Accordingly, trade helps emerging economies follow a ‘green growth’ path, and trade-related policies can enhance this path. However, the effects are economically small and require a long time horizon to become effective. Trade-related policies can become much more effective in selected countries and sectors: China attenuates labor intensity via imports of intermediate goods above average. Brazil reduces energy intensity via imports of intermediate and investment goods above average. Production of machinery as an importing sector in emerging countries can immoderately benefit from trade-related reductions in factor intensities. Electrical equipment as a traded good particularly decreases energy intensity. Machinery particularly dilutes labor intensity. Our main results are statistically highly significant and robust across specifications.
Energy intensity Labor intensity Trade Technology diffusion Convergence Emerging countries
C23 F18 F21 O13 O33 O47 Q43
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We thank two anonymous reviewers for their very helpful comments. We also thank Simon Koesler, Michael Schymura, Francois Laisney, Andreas Löschel, Peter Nunnenkamp and Holger Görg for valuable support and comments. Funding from the German Federal Ministry of Education and Research (BMBF) within the Call ‘Ökonomie des Klimawandels’ (funding code 01LA1105B: Climate Policy and the Growth Pattern of Nations—CliPoN) is gratefully acknowledged.
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