Do "Big" Liberalizations Hurt the Environment?

50 Pages Posted: 19 Jul 2024 Last revised: 6 Nov 2024

See all articles by Justin T Callais

Justin T Callais

University of Louisiana at Lafayette - Department of Economics and Finance

Vincent Geloso

George Mason University - Department of Economics

Alicia Plemmons

West Virginia University

Date Written: July 16, 2024

Abstract

There is a large literature showing that liberalizations boost economic growth. Do these gains come with environmental costs? In this paper, we use 49 cases of large-scale liberalization-as proxied by large discrete jumps on the Economic Freedom of the World Index-to study the effects of liberalizations on greenhouse gas emissions (total, per capita and per dollar of GDP) and deaths from outdoor air pollution. Using matching methods between liberalizers and non-liberalizers, we find that liberalizations have no consistent effect on total emissions or emissions per capita. However, they do reduce emissions per dollar of GDP and reduce mortality from outdoor air pollution. We then employ synthetic control methods on the largest three liberalizers and the largest de-liberalizer and find the same pattern of results.

Keywords: Economic Growth, greenhouse gases, liberalization, environmental performance

Suggested Citation

Callais, Justin and Geloso, Vincent and Plemmons, Alicia, Do "Big" Liberalizations Hurt the Environment? (July 16, 2024). GMU Working Paper in Economics No. 24-24, Available at SSRN: https://ssrn.com/abstract=4896533 or http://dx.doi.org/10.2139/ssrn.4896533

Justin Callais

University of Louisiana at Lafayette - Department of Economics and Finance ( email )

Lafayette, LA 70504
United States

Vincent Geloso (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

Alicia Plemmons

West Virginia University ( email )

P.O. Box 6025
Morgantown, WV 26506
United States

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