Unequal carbon exchanges: understanding pollution embodied in global trade

We examine carbon emission transfers via trade among countries over a 20-year period. A net transfer of carbon emission means that the emission embodied in a country’s imports exceeds the emission embodied in exports. We consider a number of socio-economic drivers to explain variations in such net transfers across countries. Our findings show a U-shaped curvilinear relationship between countries’ GDP per capita and their net carbon transfer, suggesting that countries are typically heavy net importers of carbon in early phases of economic development, become balanced or even net exporters of carbon in middle stages of development, and then return to being heavy net importers of carbon in later stages of development. We reflect on these findings in the context of ecological modernization (EM) and ecological unequal exchange (EUE) theories, as well as the environmental Kuznets curve (EKC) hypothesis