Environmental Impact Of Trade: Environmental Effects Of Global Trade

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Environmental Effects of Trade
Environmental Effects of Global Trade
Globalization is an intricate trend incorporating many forces and many effects. It is less likely that all of them are appropriate for the environment at the same time or all of them inappropriate for that matter. The most important thing here is to optimize globalization while at the same time protecting the environment. According to the Environmental Kuznets Curve, the initial stages of economic development growth causes a decline in the environment but when a particular crucial point is arrived at, any additional growth tends to result in the improvement of the environment. For the case of sulfur dioxide (SO2), this level is $5,000-$6,000 per year. That is to say that, …show more content…

There is no proof that economic growth results in damage to the natural habitat despite claims by various environmentalist groups. Also, it has been observed that as countries develop, they stop producing pollution-intensive goods and as an alternative begin to import them from countries with less stringent environmental protection laws. In the ‘race to the bottom’ hypothesis, open countries, for fear of slowing themselves down in a competitive world market, take up less strict environmental regulations to enable them export products to those less open countries. However, if this is the prime explanation for the U-shaped patterns, then future development patterns will by no means mimic the ones in the past. The reason for this is that developing countries will not always have countries that are still poor for them to treat as havens for the manufacturing of pollution-intensive products in what is called the ‘pollutions havens’ hypothesis. Be that as it may, ‘environmental dumping’ is such a negligible factor in the reduced rate of pollution when economies grow that it cannot be considered while explaining it. In fact, low-income economies can learn from mistakes made by the ones who came before them and with new technological developments that are cleaner than ever before, they have the opportunity to avoid pollution …show more content…

Research has found that trade is apparently beneficial to some facets of the environment quality, however, not all. The effects are especially favorable for some measures of air pollution like SO2. There is limited evidence that trade has a damaging impact on the quality of the environment. The findings reject the hypothesis of a global race to the bottom driven by trade where countries engage in pollution-intensive activities in order to compete in the global market. Additionally, there is a lack of evidence to support the pollution haven hypothesis claiming that trade pushes some counters to specialize in environments that are dirtier. The classic example where trade and growth can have an effect on the environment as feared by environmentalists is with regards to carbon dioxide. Gasses from greenhouses are global externalities hence there is no logic in expecting individual countries to be in a position to address them void of a global

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