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International trade and air pollution damages in the United States

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  • Xu, Yan
  • Dietzenbacher, Erik
  • Los, Bart

Abstract

This paper investigates the health and economic consequences of trade due to various air pollutants embodied in exports and imports. We compare the US emissions generated for US exports and those that were avoided by importing. An input–output framework of the US economy is employed together with a comprehensive database on damages (expressed in monetary terms) generated by pollutants, as estimated by Muller et al. (2011). We find that damages associated with international trade in 2002 were considerable. The net result is that damages were avoided through trade and that these avoided damages amounted to 2.7% of the US trade deficit and 3.4% of the US value-added associated with trade. Moreover, the computed “damage to value-added ratios” differed greatly across industries. Exports in some industries are so hazardous that more than half of the value-added gained from extra exports disappeared due to environmental damages. These findings imply that the US might benefit more from trade by increasing its exports more in low damage-intensive products than in high damage-intensive products.

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  • Xu, Yan & Dietzenbacher, Erik & Los, Bart, 2020. "International trade and air pollution damages in the United States," Ecological Economics, Elsevier, vol. 171(C).
    • Handle: RePEc:eee:ecolec:v:171:y:2020:i:c:s0921800919311073
    DOI: 10.1016/j.ecolecon.2020.106599
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    References listed on IDEAS

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