Working Papers: Trade and Environment

Carbon Offshoring and Manufacturing Cleanup

(Job Market Paper)

Production in manufacturing firms in high income countries is generally becoming cleaner. Some of this trend has been shown to be due to adoption of new technologies, but carbon offshoring – i.e. when dirty production at home is replaced with imports of carbon-intensive products from abroad – may be an additional factor. If so, this is concerning, since it risks undermining climate policies by simply moving emissions to countries with laxer regulations. This is the focus of this paper. Leveraging rich Swedish firm-product level data between 2005-2014, and employing a combination of shift-share instrumental variables and a difference-in-difference estimation approach, I find compelling paradox: a 10% increase in the import of emission-intensive goods can result in firms' production processes becoming 5% cleaner but increases transport emissions by 2\%. This suggests that carbon offshoring does not only shift emissions elsewhere but also generate new ones (via transportation). Additionally, I show that the type of offshoring, such as foreign direct investment (FDI) has a much larger emissions-reducing effect than offshoring in the form of imports of inputs not produced in-firm.

Greener Under Pressure? The Local Geography of Import Competition and Emissions in Swedish Manufacturing

(with Zoheir El-Sahli)

(Under review)

We examine how local import competition — measured across different spatial dimensions within Sweden — affects the CO2 emission intensity of manufacturing firms in Sweden. Leveraging detailed geographic data on the location of all Swedish manufacturing firms, we provide evidence that increased local import competition leads to lower emissions at the firm level, with the effect diminishing as the distance between producers and importers increases. Our findings indicate that relying on national-level measures of import competition may significantly underestimate the true environmental impact of trade shocks. We identify two primary mechanisms behind these reductions: (i) a pro-competitive efficiency-enhancing effect, where firms experience gains in total factor productivity, increasing value-added, lower marginal costs, and higher markups; and (ii) a product-mix effect, where firms reallocate production away from emission-intensive goods toward cleaner alternatives. Additionally, we find some evidence of firms relying on carbon offshoring as a response to import competition, as well as reliance on investment in pollution abatement, suggesting that firms adopt a mix of strategies to deal with increasing import competition.

Economy-Wide Impact of Carbon Taxes on Import: Evidence from Sweden

(Under review)

This paper quantifies the impacts of carbon taxes on imports, using Sweden’s 1991 policy as a natural experiment. Analyzing data from 1960 to 2005 and applying a synthetic control approach, I find that Sweden’s imports declined by approximately 20% relative to a synthetic control group of comparable OECD countries following the tax’s implementation. This translates to an average of \$20 billion reduction in import values. Importantly, these effects appear to be driven by changes in import quantities rather than shifts in GDP or import prices. Further analysis shows that while imports declined and overall import diversity increased, the reduction in imports was offset by sustained export growth. These findings suggest that carbon taxes, when designed effectively, can advance environmental goals without hampering a country’s trade balance, offering insights into how such policies may promote sustainable, competitive economies.

Environment and the Economy: Firm-level responses to energy price shocks

Although raising the carbon price is an effective tool for decreasing reliance on carbon-intensive production sources, it has also raised substantial concerns among policymakers that higher energy costs will render manufacturing firms less competitive and potentially lead to increased consumer prices. Using detailed firm-level data from 2006 to 2014 and a novel combination of shift-share instruments and dynamic difference-in-differences estimation, I identify the causal impact of energy prices on energy consumption, CO2 emissions, productivity, employment, and cost pass-through. I find that a 10\% increase in energy prices leads to an 8.6\% reduction in energy use and a 5.9\% decline in emissions, highlighting the effectiveness of energy taxation in promoting environmental goals. However, higher prices also reduce firm-level productivity by 2\% and employment by 3\%, especially among high-skilled workers. I also find evidence of partial cost pass-through to consumers, with a 10\% marginal cost increase resulting in a 2\% rise in output prices. Overall, the results provide new micro-level evidence that the economic incidence of energy pricing is heterogeneous, and the trade-off between environmental and economic goals is far from straightforward.

Carbon Border Adjustments and the Geography of Global Supply Chains

Tariffs at the Checkout: Trade Policy Shocks and Real-Time Consumer Response in U.S. Retail

(with Fred Asare Asante)

Working Papers: Development Economics

Illegal Mining, Weather, and Firm Adaptation: Evidence from Ghana's Galamsey Zones

(with Michael Danquah & Emmanuel Quarshie)

From Side Hustles to Structural Change: Gig Platforms and Labor Market Dynamics in Africa

(with Emmanuel Quarshie, Kingsley Laar, Emmanuel Ansah Otabil & James Baduor)

When the Lights Go Out: Electricity Outages and the Economic Lives of the Poor in Africa

Blackouts, Consumption Smoothing, and Adaptation Mechanisms in African Households

Power and Public Trust: The Fiscal and Institutional Consequences of Electricity Shortages

Teaching

Economics of Global Challenges (Aalto University, Spring 2025): Syllabus

Advanced Trade Theory (Lund University, 2021/2024)

International Trade Theory (Lund University, 2021/2024)

International Economics (Lund University, 2021/2024)

Econometrics (University of Ghana, 2015/2017)

International Economics (University of Ghana, 2015/2017)