Date : Jeudi | 2025-02-27 à 12h30
Lieu : Salle B.103

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Nada HAZEM (Cairo University and Paris 1 Panthéon-Sorbonne University)

This paper examines the impact of increasing environmental stringency on countries' participation in global value chains (GVCs), with a particular focus on developing economies. Using data from the UNCTAD-Eora Global Value Chain database and the ECOLEX database, this study analyzes the effect of domestic environmental regulations on both forward and backward GVC linkages across 145 countries from 1990 to 2021. The study contributes to the literature in three ways. First, it shifts the focus from gross trade to the distinct forward and backward linkages in GVC participation. Second, it is the first to explore this relationship in a large panel of 145 countries, with an emphasis on developing economies. Third, it combines both country-level and sector-level analyses, providing a more nuanced perspective. The results indicate that environmental regulations enhance forward GVC participation but reduce backward participation. The positive effect on forward linkages is driven by developed economies, whereas the negative impact on backward linkages primarily affects developing countries. Sectoral analysis shows that forward participation increases across all sectors except mining, while backward participation declines in all sectors except fishing. These findings remain robust after addressing endogeneity using an instrumental variable (IV) approach.