Estimating the effects of Kyoto on bilateral trade flows using matching econometrics

Aichele, Rahel und Felbermayr, Gabriel (2011): Estimating the effects of Kyoto on bilateral trade flows using matching econometrics. Ifo Working Paper,

Abstract

Many Kyoto countries fear a loss of competitiveness due to unilateral climate policyefforts; policymakers therefore call for carbon-related border tax adjustments. With thispaper we attempt to estimate the treatment effect of Kyoto commitment on bilateralexport flows using regression-adjusted differences-in-differences matching techniques. The gravity and international environmental agreement formation literatures provideguidelines for the choice of matching variables. We find that Kyoto countries’ exportsare reduced by 13-14% due to Kyoto commitment. Trade effects are largest in energyintensive, homogeneous industries such as iron and steel, non-ferrous metals, organicand inorganic chemicals but also in machinery and equipment.

• Item Type: Paper
• Faculties: Economics; Economics > Chairs > CESifo-Professorship for International Trade
• Subjects: 300 Social sciences > 330 Economics
• JEL Classification: F18, Q56, Q54
• Place of Publication: München
• Language: English