IS SOUTH ASIA A POLLUTION HAVEN?

Abstract

The pollution haven hypothesis maintains that the industries that are highly pollution intensive i.e. dirty industries have been migrating from developed economies to the developing world. In this study, the pollution haven argument for south Asian countries for the period of 2000–2016 is examined. It also attempts to investigate the impact of carbon emissions on the export demand of south Asian countries. The Panel data multiple regression analysis (PDMRA) has been employed to find the relationship between the exports and pollution. The study focuses on the pollution haven hypothesis from the trade perspective. It is found that exports increase as the dirtiness of the industries increases providing some evidence for the pollution haven hypothesis and carbon emissions has significant and positive impact on export demand of south Asian countries. The study also suggests the policies for the stakeholders  i.e. enforcement of environmental regulations, spending on research and development to device clean method of production and clean technologies and incentives to the producer to use cost effective clean technologies to ensure sustainable development in south Asian countries.