Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192459 
Year of Publication: 
2006
Series/Report no.: 
Discussion Papers No. 477
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
Pollution intensive production can be avoided domestically by increased imports and less exports of dirty products. Such trade effects may imply more emissions abroad, or pollution leakages. We study whether such leakages may contribute to the observed inverted relationship between emissions and economic growth - the Environmental Kuznets Curve (EKC). In our case, the rich, open Norwegian economy, we find little evidence for the hypothesis that pollution leakages contribute to explain the EKC. Despite an observed decoupling of emissions from economic growth over the past 20 years, there was no increase in pollution leakages over this period. Rather, emissions related to export increased far more than the foreign emissions embodied in import, implying reduced leakages. In future projections, we find a lower degree of decoupling than in the past, but no corresponding reductions in leakages. Instead, leakages increase. This conclusion is fairly invariant to assumptions about future climate policy.
Subjects: 
Climate policy
dynamic CGE model
endogenous policy
Environmental Kuznets Curve
pollution leakage
JEL: 
D58
O11
Q25
Q28
Q48
Document Type: 
Working Paper

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