Consumption-based carbon emissions and trade nexus: Evidence from nine oil exporting countries

The relationship between international trade and carbon emissions has been studied extensively; nonetheless, consumption-based carbon emissions, which is adjusted for international trade, have not been studied. This study is an attempt to address the gap by using consumption-based carbon emissions which is adjusted for trade in case of oil-exporting countries. The effect of international trade is analyzed by treating exports and imports separately from 1990 to 2018. The long-run impact of all variables, i.e., exports, imports, and gross domestic product (GDP) is higher than the short-run coefficients. The empirical evidence, both in the long-run and short-run, confirms the negative effect of exports on consumption-based carbon emissions. Furthermore, gross domestic product (GDP) and imports have a positive and statistically significant impact on consumption-based carbon emissions both in the short-run and long-run. Policies related to consumption-based carbon emissions and international trade shall realize the effect of government policies to absorb it fully by taking approximately two years. •This study examine the effect of consumption-based emissions on International trade from 1990-2018.•Exports decreases, while imports and gross domestic product increase consumption-based carbon emissions.•The long-run coefficients are higher than the short-run coefficients.•Government policies effect shall realize to absorb fully by taking approximately two years.