Economic Complexity and Environmental Performance: Evidence from a World Sample
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Date
2021-06
Publication Type
Journal Article
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yes
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Abstract
In this paper, we analyze the relationship between economic complexity and environmental performance using annual data on 88 developed and developing countries for the period of 2002-2012. We use the Economic Complexity Index, which links a country's productive structure with the amount of knowledge and know-how embodied in the goods it produces, and the Environmental Performance Index as a measure of environmental performance. We show that moving to higher levels of economic complexity leads to better overall environmental performance, which means that sophistication of exported products does not induce environmental degradation. Nevertheless, we find that the effect of economic complexity on air quality is negative, i.e., exposure to PM2.5, CO2, methane and nitrous oxide emissions increases, and these findings are robust across alternative econometric specifications.
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published
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Journal / series
Volume
26 (3)
Pages / Article No.
251 - 270
Publisher
Springer
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Software
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Subject
Economic complexity; Environmental performance; Pollution; CO2 emissions