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Why America's Air Is Less Polluted

by Travis Pantin
Thu, 3 Jan 2008 at 12:31 PM

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Since the 1970s, air pollution has fallen significantly in America. But was that decrease the result of cleaner manufacturing processes, or did pollution disappear because America shifted its dirty production to developing countries?

Some have argued against globalization on the grounds that the latter is true. On the VoxEU blog, an associate professor of economics at Georgetown University, Arik Levinson, says such arguments are probably wrong.

According to Mr. Levinson, the standard framework for mulling the effects of trade on the environment involves thinking about pollution as the product of three components: the overall size of the economy, the mix of sectors comprising the economy, and the technologies employed in production and abatement.

"If pollution increased one-forone with manufacturing output, then pollution from US manufacturing would also have increased 71 percent. This is the scale effect," he writes. On the other hand, if the pollution reductions came mostly from relocating polluting industries overseas, the effect would be attributable to changes in the composition of the American economy.

After some calculations, Mr. Levinson writes that America's pollution reductions came largely from technological improvements, rather than from changes in the composition of the American economy.

"The environmental concerns of antiglobalization protesters have been overblown," Mr. Levinson writes. "The pollution reduction achieved by US manufacturing will replicable by other countries in the future."

STOCK STILL
When finance blogger Felix Salmon gets questions from readers asking him whether he could recommend some hot stocks for them to buy, he says the answer is easy: "No."

He elaborates: "I can say that anybody looking to me for stock picks really has no business picking stocks in the first place."

Mr. Salmon writes that he takes no one's advice on stocks. "My meager retirement funds are invested in the broadest, cheapest, and most global index funds I could find, and even then I'm worried that equities aren't a particularly intelligent asset class to be overweight right now."

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