Working Papers

Abstract: I quantify the welfare effects of international trade in waste. I build a structural gravity model in which waste generation is a byproduct of manufacturing and waste is input to recycling. My estimates reveal that low-value waste is more sensitive to trade barriers than high-value waste, while richer countries import a greater share of high-value waste than low-value waste. Although existing patterns of waste trade make countries of all income levels better off, low-value waste trade, which creates large negative externalities relative to its private value, makes middle-income countries worse off. I estimate that China’s 2018 ban on low-value waste imports made China and several lower-income countries better off. Depending on the type of waste trade banned, manufacturing production across countries also faces differentiated impact. While a high-value waste trade ban hurts manufacturing in rich countries, a low-value waste trade ban reduces the output in lower-income countries.

Presentations (§ scheduled): CU Environmental & Resource Economics Workshop 2022, Midwest International Trade Conference 2022, American Economic Association 2022 (Poster), Southern Economic Association 2021, Western Economic Association Annual 2021, Midwest Economic Association 2021, Western Economic Association International 2021, Heartland Environmental and Resource Economics Workshop at Illinois 2019, UIUC Graduate Seminars

Abstract: We study network effects in the diffusion of regulatory standards through international trade. Our results show that countries are more likely to domestically adopt regulations that they comply with while exporting. We find evidence of such diffusion primarily in regulations concerning attributes of the final product rather than production processes. Consistent with a network effect, we show that countries more open to international trade are the drivers of regulatory diffusion. In an analysis of diffusion in individual features within labelling regulations---the most prevalent regulations in our data---we find that labelling requirements ensuring safety of use propagate the most, and countries tend to domestically adopt features similar to those imposed by their importing partners. Overall, our results support the argument that economic integration can facilitate the strengthening of regulatory standards.

Presentations († by co-author): Midwest Economic Association 2021, North American Regional Science Council 2020, Mid-Continent Regional Science Association 2019, UIUC Graduate Seminars

Work in Progress

Membership in Quasi-Exclusive Multilateral Agreements: The Incentives to Adopt the Basel Convention (with George Deltas)

Abstract: We study the incentives for the adoption of a multilateral waste trade agreement, known as the Basel Convention. This agreement, which regulates the flow of hazardous waste across countries, works on a prior-informed-consent system, whereby before the actual waste shipment takes place, the exporting member country must notify the importing member country and the importing country must consent to that shipment. Further, members are prohibited from trading in hazardous waste with non-members unless they have a no less environmentally sound side-agreement with such non-members. Using panel data for accession to the Convention by countries combined with data on bilateral waste flows for 32 years, we find that country pairs where at least one partner hasn't ratified the Convention trade more than pairs where both did. However, as the share of countries part of the Convention increases, the trade among members increases while that among country pairs where either is a non-member decreases. Our results show that once the share of member countries hits the 60-70% threshold, members account for a larger share of world waste trade than non-members, thereby creating economic incentives for such countries to join.

Presentations (§ scheduled, † by co-author): AERE@SEA 2022§†

Transboundary Diffusion of Regulations: Role of Product Proximity and Product Heterogeneity (with Sergio Rocha)

Abstract: International trade can foster policy coordination among countries by facilitating regulatory diffusion from regulation-imposing importers to their exporting partners. Using panel data on multiple regulatory standards imposed by countries on imported products, we uncover the extent to which a country's exports that must comply with a particular regulation contribute to the domestic implementation of the same regulation on other related products. Such cross-commodity diffusion would occur for regulations for which the gain in value on foreign markets exceed the costs of expanding implementation to related products. We also assess heterogeneity in diffusion by commodity characteristics by combining our data set with information on product complexity, hazardousness, and end-use. By augmenting traditional methods of estimating network effects, our empirical strategy allows us to quantify and contrast the direct within-commodity and indirect cross-commodity channels of diffusion and shed light on the product characteristics more strongly associated with diffusion due to pressure from importers.