This paper analyzes the effects of carbon taxation and carbon border adjustments in a setting
where firms can choose to respond to taxation by abating, or by outsourcing part of their production.
For this, we set up a general equilibrium trade model, calibrated with world trade and input-output
data that features a discrete choice production structure, where the producers choose between
outsourcing or abating emission-intensive intermediate production steps. The paper finds that
border adjustments that only target scope 1 emissions can lead to outsourcing, and thus leakage,
further down the value chain, but nevertheless induce higher abatement both in the countries that
impose the border adjustment and in the ones affected by it.
Most recent draft
We study the effects of the EU Emissions Trading System (ETS) on economic performance and investments of Dutch manufacturing firms.
Motivated both by sizable differences between firms that are regulated in different phases and by a gradual increase in regulatory stringency,
we pay close attention to treatment effect heterogeneity between firms and over time. We use microdata from Statistics Netherlands to show
how using a two way fixed effect estimator in such a staggered difference-in-differences setting could lead biased results and
then use more recent econometric techniques to capture the ETS's treatment effect. We find no effects of the ETS on investment behavior
and profitability,
but sizable negative effects on the turnover of firms that were regulated the earliest and were the most energy-intense.
Most recent draft
We study the effects of market integration on manufacturing emission intensities of CO2, SOx, and NOx.
For this, we analyse the 2004 and 2007 EU enlargements in a sectoral panel with data on almost all EU member states from 1995 to 2015.
We pay close attention to relevant channels of trade, regulation, and efficiency.
Overall, the enlargements have resulted in a reduction of emission intensities in new member states: new regulations,
which accession countries needed to adopt, have lowered pollution intensities strongly; induced improvements in productivity have further reduced them;
and trade integration into the EU has had insignificant effects on emission intensities.
We also do not find evidence of within-EU pollution haven effects and thus of leakage from old to new member states.
For old members, trade integration, if anything, increased emission intensities,
but efficiency improvements have also contributed to cleaner manufacturing sectors here.
Working paper
Free trade can drive efficiency increases in the utilization of natural
resources, but it can also leave countries overly exposed to foreign
sources of raw materials. Furthermore it can induce material intensive
production to relocate abroad if more stringent rules are adopted at
home, a phenomenon known as "leakage" in the trade and environment
literature. Applying well-established concepts and analyses from
the trade and pollution literature to the effects of free trade on
natural resources and materials, we find statistically significant,
but economically small evidence, for higher income countries decreasing
their material usage when opening up for trade, while lower income
countries increase theirs. This indicates some for of outsourcing.
We also find that the famous environmental Kuznets curve behavior seems
to be present for materials as well, but the evidence on this is weaker
than for CO2. Finally, the similarities between the
results for raw materials and those for CO2 indicate that well-designed
policy that addresses both domains and takes trade channels into consideration could increase the desired outcomes.
Draft available upon request
This paper studies the effects of a 2017 ban on waste imports, imposed by China, on the reallocation of waste trade.
Until then, China imported between 30 and 50\% of all global waste, hence implying large diversion effects after the ban was implemented.
I plan to derive a theoretical model, showing that waste trade in essence occurs for two reasons: disposal and recycling.
This implies that there is both an incentive for countries with higher environmental preferences to send waste intended for disposal abroad
(a so-called "waste haven effect"), and for industry-intense economies to purchase waste, recycle it, and use it as an input in production.
I then estimate the effect of the ban on the imports of all countries except China and plan to show how countries with different characteristics -
regarding the two motives for waste trade - have responded differently to the shock.
A very early analysis suggests that middle income countries and countries with low recycling costs have increased waste imports as a response.
Non-technical summary
We asses the dynamics of the relationship
between trade and circular economy outcomes; both in the EU and globally.
We focus specifically on developing countries and highlight the dependence
of the EU on marterial-intense imports from countries outside the block.
Acces report
The introduction of widespread trade restrictions between the West and both Russia and China (referred to as decoupling) precipitates significant short-term shifts in trade flows. The impact on various Dutch industries differs notably. Over the long term, decoupling adversely impacts the Dutch economy, albeit in a manner consistent with other Western nations. Notably, China and Russia face more severe repercussions than the West when trade relations are halted.
Acces report
The Dutch manufacturing industry is undergoing significant changes, with a growing emphasis on income derived from services. We are witnessing a gradual shift in the types of activities that contribute to the Netherlands' earnings from global production chains. Workers in the Netherlands earn from goods made both domestically and abroad, but there is an increase in earnings from services such as consultancy, alongside a decline in earnings from production activities like assembly.
Acces report