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G7 countries: between trade openness and CO2 emissions

Author

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  • Mihai Mutascu

    (ESCE International Business School, and LEO, University of Orleans)

Abstract

The paper analyses the causality between the trade openness and CO2 emissions in the G7 countries by using the bootstrap panel Granger causality. The panel includes seven countries (i.e. Canada, France, Germany, Italy, Japan, United Kingdom and United States of America) and covers the period 1995-2011. The main results show a strong heterogeneity between the G7 countries in terms of international trade and environmental issues. The CO2 emissions embodied in domestic final demand explains very well the trade openness, more precisely the imports. A higher propensity for social environmental responsibility characterizes the importers from EU countries comparing with the non-EU ones. Otherwise, the trade openness is a good proxy for the CO2 emissions generated by the sector of production. Curiously, the very big economies register an auto-regulatory mechanism of CO2 emissions related to trade, for both domestic consumption and production areas.

Suggested Citation

  • Mihai Mutascu, 2018. "G7 countries: between trade openness and CO2 emissions," Economics Bulletin, AccessEcon, vol. 38(3), pages 1446-1456.
    • Handle: RePEc:ebl:ecbull:eb-18-00369
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    References listed on IDEAS

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    More about this item

    Keywords

    Trade openness; CO2 emissions; Bootstrap panel causality; G7 countries;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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