CHAPTER 1: INTRODUCTION TO PROJECT

Title: Nexus between CO2 emissions and trade globalization index

The nexus between CO2 emission and trade globalization index has been a topic of
interest for researchers in recent years. The increasing global trade and economic
growth has been accompanied by a rise in carbon emissions, which has been
linked to climate change. The trade globalization index is a measure of the level of
integration of a country's economy into the global economy, and it has been
suggested that it may have an impact on CO2 emissions.

The purpose of this research paper is to investigate the relationship between CO2
emissions and trade globalization index, and to identify the factors that influence
this relationship. The paper will review the existing literature on the topic, and
present an empirical analysis of the relationship between these variables using
data from a sample of countries.

The research will begin by reviewing the literature on the relationship between
CO2 emissions and trade globalization index. This will include an overview of the
various theories and models that have been proposed to explain this relationship,
as well as a discussion of the empirical evidence that has been generated to date.

The empirical analysis will be based on a sample of countries, and will use
statistical techniques to estimate the relationship between CO2 emissions and
trade globalization index, controlling for other relevant factors such as economic
development, population size, and energy consumption. The results of the analysis

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will be presented and discussed, and the implications of the findings for policy and
future research will be discussed.

Overall, this research paper aims to contribute to the understanding of the nexus
between CO2 emissions and trade globalization index, and to provide insights into
the factors that shape this relationship. The findings of this research may have
important implications for policy makers, as they seek to balance the benefits of
trade globalization with the need to mitigate the negative environmental impacts
of economic growth.

There are several ways in which trade globalization can impact CO2 emissions.
Firstly, increased trade can lead to increased production and transportation of
goods, which in turn can lead to higher CO2 emissions. Secondly, trade
liberalization can lead to increased competition, which can result in firms
relocating production to countries with weaker environmental regulations,
resulting in increased emissions.

To measure the nexus between CO2 emissions and trade globalization index,
researchers have developed various indices such as the KOF Globalization Index
and the World Bank's Logistics Performance Index. These indices measure
different aspects of trade globalization such as economic flows, information flows,
and the ease of doing business across borders.

Empirical studies have shown mixed results regarding the relationship between
CO2 emissions and trade globalization. Some studies suggest that trade
globalization leads to increased CO2 emissions, while others find no significant
relationship or even a negative relationship between the two variables. However,

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most studies agree that the relationship between CO2 emissions and trade
globalization is complex and depends on a range of factors such as the level of
economic development, the stringency of environmental regulations, and the
availability of clean energy sources.

There is a growing body of research that suggests that trade globalization and
carbon emissions are interrelated. On the one hand, trade liberalization has led to
an increase in the volume of international trade, which in turn has increased the
demand for energy and transportation. This has led to an increase in carbon
emissions, especially in developing countries where energy-intensive industries
have flourished.

On the other hand, trade globalization has also facilitated the transfer of
technology and expertise, which has enabled countries to adopt cleaner and more
energy-efficient technologies. This has led to a decrease in carbon emissions in
some countries that have successfully transitioned to cleaner energy sources.

Overall, the relationship between trade globalization and carbon emissions is

complex and depends on a variety of factors, including the level of economic
development, the types of industries present, and the policies and regulations in
place to address environmental concerns. It is important for policymakers to
consider the nexus between these two variables in designing policies that promote
sustainable economic growth and reduce carbon emissions.

The relationship between CO2 emissions and trade globalization index is an

important research topic that has gained increased attention in recent years. The
concept of trade globalization index refers to the extent to which a country has

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integrated itself into the global economy through the liberalization of trade, the
increase in foreign investment, and the growth of international economic
cooperation. On the other hand, CO2 emissions refer to the release of carbon
dioxide into the atmosphere as a result of human activities, particularly those
related to industrial and transportation activities.

The relationship between these two variables is complex and multifaceted. On one
hand, the increase in trade globalization can lead to higher levels of economic
growth, which in turn can lead to increased industrial and transportation activities,
and consequently higher levels of CO2 emissions. On the other hand, trade
globalization can also lead to increased technological advancements and the
adoption of cleaner production technologies, which can reduce the carbon
footprint of industries and transportation.

Given the potential implications of this relationship on environmental

sustainability and economic development, it is important to gain a deeper
understanding of the dynamics between CO2 emissions and trade globalization
index. This research topic has important implications for policymakers,
environmental advocates, and business leaders, and can inform the development
of strategies and policies aimed at mitigating the negative environmental impact
of economic growth while also promoting sustainable economic development.

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 CHAPTER 2: Literature Review

(Ahmed & Phong le, 2020) this paper explores the effect of ICT and the recently
developed trade globalization index on CO2 emissions in ASEAN-6 countries. The
study relies on advanced panel econometric approaches, including Westerlund
(2007, 2008) and Pedroni cointegration tests, CUP-FM long-run method, and panel
DH causality approach. The results suggest cointegration among variables. The
results of CUP-FM indicate that ICT contributes to improving environmental
quality by mitigating CO2 emissions. Similarly, trade globalization is also
sustainable in the region as it reduces emissions. The results are also confirmed by
using the CUP-BC estimator. The findings from the DH causality test unfold
causality from ICT and trade globalization index to CO 2 emissions. Besides, the
long-run estimates reveal the detrimental effect of energy consumption on
emissions and the U-shaped association between GDP and emissions.

(leu, Ren, Cheng, & Wang, 2020) In order to provide flexible and comprehensive
results about the relationship between globalization and CO  emissions for
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the G7 countries, we introduce the KOF globalization index into traditional

Stochastic Impacts by Regression on Population, Affluence
and Technology model, and conduct the empirical analysis by applying a semi-
parametric panel fixed effects model. The data covering the period of 1970–2015
consists of CO  emissions, KOF globalization index, renewable energy
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consumption and GDP. Our results indicate that the relationship between
globalization and CO  emissions are inverted U-sharped, which strongly support
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the Environmental Kuznets Curve hypothesis.

(Aslam, Hu, Ma, AlGarni , & Saeed, 2021) The rise of globalization has driven
Malaysia’s economic development at the ecosystem level of pollution. This
research study explores the relationship of CO  emissions, gross domestic
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product, globalization, industrialization, and trade openness for Malaysia by

using annual data for 1971–2016. By applying the ARDL bound testing approach,
the estimates infer that CO  emissions have steadily risen with high economic
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growth and affirm the U-shaped environmental Kuznets curve (EKC).

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