Mitigating Emissions Associated With the Production of Traded Goods

The environmental impact of international trade is a concerning issue in the fight against climate change. Trade liberalization—combined with globally fragmented environmental policies—is often associated with the formation of pollution havens. This is because trade enables emissions leakages, which is defined as the outsourcing of emissions-intensive production to countries with weaker environmental regulations. Therefore, literature on this subject has suggested that a globally coordinated policy response is necessary to mitigate the impact of trade on climate change (Aichele & Felbermayr, 2012; Ben-David et al., 2020; Felbmermayr & Peterson, 2020). However, some studies have found that unilateral policy actions have no tangible effect on the volume of emissions associated with trade and, in some cases, the reduction of emissions volume associated with trade (Baylis et al., 2014; Kumar & Prabkahar, 2016; Hoekstra et al., 2016). This policy brief aims to provide insights on unilateral or multilateral actions countries can take to mitigate the impact of embodied emissions associated with the production of traded goods

Effect of the COVID-19 pandemic on airfare factors, and the air transportation and tourism industries: The case of the Philippines

Airline pricing considers various factors such as flight length, operators, and seat availability. As the airlines and passengers’ perspectives towards airline pricing has been evolving, other studies did not consider other aspects like time of the day as part of the airlines’ pricing strategy. Additionally, the global tourism industry, which has been consistently growing since 2010, had its momentum grinded to a halt due to the COVID-19 pandemic, which poses the question on how airfare pricing behaves during a health-related crisis, particularly during the current pandemic. Another gap is the evaluation of economic loss from a health-related disaster that lasted for a prolonged period. This study uses a combination of airfare movement analysis using fixed effects and/or random effects methods and estimating economic loss using the persistent inoperability input-output model through airfare data of selected Manila-based routes and the Philippine input-output table, respectively. Aspects such as advance purchasing and ticket cancellation are consistent with the existing literature, while day of the week purchase and certain fare bucket characteristics had mixed results. The economic impact the pandemic has had so far is significant with greater ripple effects on sectors that the air transportation and tourism industries rely on

Climate change and trade: What unilateral or multilateral actions are needed to mitigate emissions embodied in trade flows

The environmental impact of international trade is a concerning issue in the fight against climate change. Trade liberalization—combined with globally fragmented environmental policies—is often associated with emissions leakages and the formation of pollution havens because trade allows countries to outsource emissions-intensive production to countries with weaker environmental regulations. Literature on this subject has therefore suggested that a globally coordinated policy response is necessary to mitigate the impact of trade on climate change. This study aims to contribute to the existing literature by identifying unilateral and multilateral actions countries can take to mitigate the impact of embodied emissions associated with bilateral trade. Through a gravity model estimating the impact of regulation, domestic carbon intensities, and several other gravity variables, this study is able to provide novel conclusions in the context of the existing literature. Particularly, a unilateral strengthening of environmental regulation by the importing country can contribute to climate change mitigation in the best case, and has a statistically insignificant effect in the worst case. This study also finds that multilateral coordination in technological diffusion and trading agreements can also aid in mitigation efforts