Iris Claus: Per capita carbon dioxide emissions more than doubled in Malaysia, China, and Thailand between 1990 and 2011 (Figure 1). These emissions are contributing to environmental degradation and climate change and have led governments in Asia to take action to improve the production and use of low-carbon technology and associated pollution abatement services.
Trade and investment in low-carbon energy technology and environmental services has been low in emerging Asia compared with other energy intensive sectors. This is despite low effective tariffs and some low-carbon goods and services (e.g., biomass boilers, solar panels, wind turbines) being labor intensive to produce. Emerging Asia has a relatively abundant labor supply and the Heckscher-Ohlin theorem implies that countries should be producing and exporting labor-intensive goods and services. The reason for the low trade and investment in low-carbon energy technology and environmental services is that non-tariff barriers or behind the border constraints are...