Trade imbalance, heavy goods, and pollution

• Main Authors: LEE, Jungho, WEI, Shang-jin, XU, Jianhuan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2024
• Subjects: Trade surplus; Shipping costs; Pollution; Trade imbalance; International economics literature; Economic equilibrium; Econometrics; Economics; International Economics
• Online Access: https://ink.library.smu.edu.sg/soe_research/2779; https://ink.library.smu.edu.sg/context/soe_research/article/3778/viewcontent/Trade_imbalance__heavy_goods__and_pollution.pdf
• Institution: Singapore Management University

We propose a new welfare effect of trade surplus. Guided by insight from several fields in economics, we provide evidence that an increase in a country's trade surplus alters the unit shipping costs for its trade and the composition of its imports in ways that induce more pollution in the count...