Agricultural trade shocks and carbon leakage: Evidence from China's trade shocks to the Belt & Road economies

Existing literature on carbon leakage mostly focused on polluting industries or at the national level. Agriculture is one of the main sources of carbon emissions, however, research on agricultural carbon leakage is still insufficient. To fill this gap, this paper investigates the impact of China's agricultural trade shocks on carbon emissions in a panel of 62 economies along the Belt and Road (B&R) over the period 1990–2017. The results show that China's supply shocks have a significant inhibitory effect on the agricultural carbon emissions of the B&R economies, and this inhibitory effect is very stable and will not be disturbed by other factors. On the contrary, China's demand shocks only have a significant inhibitory effect on the carbon emission intensity of economies with a higher proportion of agriculture, but it will significantly increase the agricultural carbon emissions share in all economies.