More Indirects Effects

Assalamualaikum..these are more indirects effects that will happen towards environment through GLOBALISATION..

In their review of the literature on the PHH and PHE, Copeland and Taylor (2004) credited
some of the recent success in uncovering impacts of globalisation on the environment to the
pairing of theory and empirics. In the early 1990s, researchers identified that globalisation is
likely to impact the environment through three principle channels – composition, scale and
technique effects:

● The composition effect measures changes in emissions arising from the change in a
country’s industrial composition following trade liberalisation.6 If, for example,
liberalisation induces an economy’s service sector to expand and its heavy industry to
contract, the country’s total emissions will likely fall, since the expanding sector is less emission intensive.
● Under the scale effect, more efficient allocation of resources within countries shifts the global production possibilities frontier, raising the size of the industrial pollution base and resulting in greater global emissions.
● The technique effect refers to the plethora of channels through which trade liberalisation impacts the rate at which industry and households pollute. These channels include changes in the stringency of environmental regulation in response to income growth or the political climate surrounding regulation. The technique effect also includes
technology transfer facilitated by trade.