Conference Agenda

International trade relies strongly on the reliable functioning of the maritime shipping network. This paper uncovers how much of global port-level trading is disrupted due to severe tropical cyclones and whether trade shifts to neighboring routes. Exploiting an event-study approach nested within a gravity framework, we find that a cyclone reduces trade flows by -8.0\% between affected port pairs, while this effect even extends to country pair trade, although with smaller magnitude. We find no according shift to neighboring routes. Instead, shipping firms charge higher freight prices on affected routes that might amplify the trading impact. Evidence from geo-located container ship voyages shows that ships facing a cyclone ahead on their journey travel at slower speed, longer effective distances and thus incur time delays.

This paper presents a method for estimating treatment effects of local climate shocks when

regions trade with each other. Because of spillovers induced by trade flows, comparing the

evolution of outcomes between pre-shock and post-shock periods in regions exposed versus

unexposed to local shocks leads to a biased estimate of treatment effect. We model these

across-region dependencies using standard assumptions from international trade theory. We

use our model-consistent estimation strategy to revisit the literature on the evaluation of im-

pacts from climate change onto country-sector gross output using year-to-year variation in

temperature and counterfactual scenarios where the observed warming from 1991 to 2019

would not have occurred or considering future warming predictions.

In this paper we study recent proposals to reduce the energy cost of the industry

in the European Union as part of an industrial policy that should lift competitiveness

of this sector worldwide. Using an applied general equilibrium model explicitly

suited to study overlapping instruments in the context of European EU ETS we

compare three support programs by a coalition of three EU countries with a large

energy-intensive industrial sector, in particular France, Germany and the Netherlands.

Subsidies boost competitiveness in the short run though with an increase

in European emissions as long as the active Market Stability Reserve dampens the

waterbed effect within the EU ETS. Interestingly, in some cases, support policies

may lead to lower global emissions, since the subsidized industrial sectors within

the coalition are relatively clean.

China's integration into global value chains (GVCs) in the 2000s drove rapid growth and attracted substantial foreign investment, while coinciding with a sharp increase in environmental pollution. This study examines how foreign ownership interacts with firms’ positions along GVCs to shape abatement of chemical oxygen demand (COD) and ammonia (NH3), two key pollutants affecting water and air quality. Using granular firm-level data spanning the years 2000 to 2013 and combining pollution, production, and trade records, we find that foreign-owned firms outperform domestic firms in pollution abatement. New to the literature, we reveal that the foreign ownership advantage diminishes as firms move upstream in the value chain. Further analysis suggests that this attenuation is driven by lower productivity of foreign-owned firms in upstream sectors, which constrains their ability to undertake pollution abatement. In addition, we find that stronger foreign stakeholder pressure mitigates the upstream attenuation of foreign firms’ abatement efforts for COD, but not for NH3. Overall, these findings highlight the importance of accounting for value chain positioning when designing policies aimed at leveraging FDI for environmental improvements in large developing economies.