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The Impact of Kyoto Protocol on Environment Quality in the Free Trade Era: Case of G20 Countries

Author

Listed:
  • Puspaning Buanawaty

    (Faculty of Economics and Business, Universitas Indonesia, Indonesia,)

  • Fithra Faisal Hastiadi

    (Faculty of Economics and Business, Universitas Indonesia, Indonesia.)

Abstract

The impact of trade openness on environment is not easy to be figured out. The scale and technique effects of trade tend to have opposite direction, while the composition effect depends on the comparative advantage of a country. One way to avoid the world's emission level is the ratification of Kyoto Protocol in 1997. This study aims to analyze the impact of trade openness and Kyoto Protocol on CO2 emission level. This research employs macroeconomics data in G20 countries from 1996 to 2008 by using ordinary least squares with gravity instrument variable model from G20 countries trade flows. The estimation results indicate that trade openness has positive and significant effect on CO2 emissions level. Meanwhile, Kyoto Protocol has insignificant effect on CO2 emissions level, thereby signifying the ineffectiveness of the Protocol's implementation.

Suggested Citation

  • Puspaning Buanawaty & Fithra Faisal Hastiadi, 2017. "The Impact of Kyoto Protocol on Environment Quality in the Free Trade Era: Case of G20 Countries," International Journal of Economics and Financial Issues, Econjournals, vol. 7(3), pages 36-42.
    • Handle: RePEc:eco:journ1:2017-03-6
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    References listed on IDEAS

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    More about this item

    Keywords

    Trade Openness; Kyoto Protocol; CO2 Emissions;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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