The Environmental Impact of International Trade Participation: Empirical Evidence from a Cross-Country Panel Data Analysis

One of the most critical challenges to achieving sustainable economic growth that all countries are facing is environmental degradation. However, the issue that has received little attention in the debate on the environmental impact of macroeconomic variables is testing the impact of international trade participation on environmental degradation. This paper will revisit the question of whether international trade participation significantly impacts environmental degradation across countries. Utilizing a dynamic panel data regression model will enable us to overcome some methodological gaps in the literature on the impact of international trade participation on environmental degradation. This paper will contribute to the debate over the efficacy of trade policy reforms on sustainable growth. This paper will also extend our knowledge of the heterogeneity effects of the environmental impact of international trade participation across countries: developed vis-à-vis developing countries, sub-Saharan countries vis-à-vis the rest of the world, and East African community vis-à-vis the rest of the world.