Unraveling the impact of environmental provisions in preferential trade agreements on green total factor energy efficiency.

Environmental provisions in Preferential Trade Agreements (PTAs) have increased in recent years, however, their impact on green total factor energy efficiency (GTFEE) remains underexplored. Utilizing comprehensive data on countries' engagement with PTAs' environmental provisions, along with environmental legislative information and green trade data, this study employs various quantitative and qualitative research methods to investigate heterogeneity influence, mechanism, nonlinear relationship, and combined effect of PTAs' environmental provisions on GTFEE. The empirical results indicate that: (1) Environmental provisions within PTAs significantly enhance the GTFEE of participating countries, which is more pronounced in North-South PTAs, particularly when these provisions are closely tied to trade issues. (2) Environmental provisions in PTAs improve the GTFEE by promoting environmental legislation, facilitating green goods trade, and fostering cleaner energy structures in participating countries. (3) As the number of PTAs' environmental provisions increases in participating countries, their effect on GTFEE follows a pattern of initial inhibition, followed by promotion, and ultimately insignificance. (4) The combined effect of different types of environmental provisions in PTAs reveals three primary pathways contributing to improved GTFEE: the "environment", the "environment-trade synergy", and the "trade-safeguard synergy".
Competing Interests: Declaration of competing interest The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
(Copyright © 2024 Elsevier Ltd. All rights reserved.)