The Environmental Impacts of Agricultural Trade: A Systematic Literature Review

Abstract

In line with the development of international trade, environmental concerns have arisen as a global problem. International trade has the potential to increase environmental externalities such as transboundary pollution, deforestation, transportation and production relocation avoiding environmental standards. The share of agricultural goods in total export reached 15% in 2017. Since 2002, the proportion of unprocessed agricultural products have more than doubled, while the volume of processed goods in global trade has tripled. Despite the importance of agricultural trade worldwide, the number of studies exploring the trade-agriculture-environment nexus has so far been limited. This paper aims to provide an overview of the environmental impacts of agricultural trade based on the international economics literature published in recent years by way of a systematic literature review. Results suggest that most recent environmental studies do not view extended trade or trade liberalization in agriculture favourably. Only a limited number of papers state that a country or countries’ environment could benefit from agricultural trade, and only a few researchers have found that agricultural trade did not have any significant influence at all, or have instead found the effects on the environment to be ambiguous. Finally, the research reveals the most important consequences of pollution and offers potential solutions.