Abstract
The main focuses of the Sino–US trade dispute are the issue of trade interests. If taking environmental costs into consideration, the trade interests are even more overestimated. There are different methods for measuring trade interests, and the results obtained under different methods differ. This paper uses the gross trade, value-added trade and value-added-in trade framework to calculate the economic gains and correspondent embodied pollution in China–US trade, compares the differences in results under different models and makes possible explanations. Our conclusions are as follows: (1) Traditional gross trade statistics have overestimated China’s economic benefits. The trade balance in gross trade was overestimated by 35% and 40% compared to the value-added trade and value-added-in trade. (2) China was a net exporter of embodied pollution and paid huge environmental costs from 1995 to 2011. (3) China’s exports are environmentally worse than the United States, and the calculation of pollution terms of trade proves that China paid a greater environmental cost for the same amount of economic benefits. (4) Different accounting frameworks have a great impact on the embodied pollution results at the industry level. Pollution based on value-added trade was more concentrated. The major polluting industries also changed.
Highlights
The trade balance in gross trade was overestimated by 35% and 40% compared to the value-added trade and value-added-in trade
In 1996, Antweiler proposed the Pollution Terms of Trade (PTT), which is used to measure the economic benefit and the environmental losses of a country when participating in international trade
Based on the value-added-in trade accounting, the actual domestic value added of China’s exports to the United States was $270 billion, the domestic value added of US exports to China was $97 billion, and the net domestic value added in exports was $173 billion
Summary
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. Trade disputes between China and the United States have become the center of public attention in recent years. According to the World Bank, China–US trade surplus hit a record high of $323.3 billion in 2018. The United States believes that China’s trade surplus with the US was caused by “unfair trade practices” and intellectual property theft, and they set tariffs and other trade barriers on China. It would be premature to draw a conclusion on gains and losses in Sino–US trade
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
