Trade and Water Pollution

The effects on water pollution depend not just on the stringency of policy, but also on the type of policy instrument used. Trade driven by differences in environmental policy tends to increase the concentration of polluting industries in the country with weaker policy; the effect of such trade on the environment depends on the policy instruments in place.We examine with the ACT (Antweiler, Copeland and Taylor) model the effects of trade liberalisation on water quality in the region of Mediterranean developed, developing countries and North-South countries over 1980-2013, also the impact of the domestic environmental policies on water quality, when trade is liberalized in the three regions.Our results show that the trade liberalisation increases BOD pollution in the regions of South, North and North-South countries. We find that under trade liberalisation, the implementation of the policy of high energy efficiency helps to the reduction of BOD pollution.

Keywords:

Trade , Environment , Environmental Policies , Mediterranean Countries