Table 4

Environmental tax and trade development

Variables(1)(2)(3)(4)(5)
TradeTradeTradeTradeTrade
Trade = Lag,0.906***0.877***0.866***0.870***0.828***
(0.0309)(0.0323)(0.0210)(0.0198)(0.0273)
Environmental tax−2.881**−1.806**−1.713***−5.713***−2.415**
(0.974)(0.525)(0.020)(1.020)(1.065)
Political stability0.968***    
(0.015)    
Government effectiveness 0.327***   
 (0.025)   
Control of corruption  −1.398**  
  (0.464)  
Rule of law   1.431*** 
   (0.248) 
Regulatory quality    5.098**
    (0.191)
Carbon emission (CO2)−0.468−0.575−0.889***−0.598**−1.043***
(1.031)(1.295)(0.093)(0.185)(0.050)
Energy usage4.568***−0.02481.605**0.9337.933**
(1.492)(4.558)(0.470)(2.754)(3.397)
Foreign direct investment0.398***0.309***0.325***0.310***0.389***
(0.0733)(0.0496)(0.0491)(0.0408)(0.0356)
Agricultural growth−0.0670−0.112**−0.127***−0.125***−0.160***
(0.0415)(0.0447)(0.0379)(0.0415)(0.0450)
GDP growth0.281***0.378***0.384***0.380***0.353***
(0.0594)(0.0495)(0.0502)(0.0559)(0.0444)
Constant−13.284.4231.2231.872−17.14*
(12.20)(8.120)(6.082)(5.459)(8.376)
AR10.0050.0070.0080.0080.011
AR20.1800.1650.1750.1680.130
Sargan test0.4620.4440.5860.4880.538
Hansen Test0.5470.5710.5680.5500.631
Country effectYesYesYesYesYes
Time effectYesYesYesYesYes
Observations375375375375375
Number of countries2525252525

Note(s): Standard errors in parentheses. ***p < 0.01, **p < 0.05, *p < 0.1

Source(s): Authors’ compilation, 2025
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