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Impact of Trade Liberalization on theEnvironment in Developing Countries: TheCase of AfghanistanBYKhorshid Hotak301-1504002May, 2019Research project submitted in partial fulfillment of the requirement for the degree ofBBA/BSc. Economics at Kardan University, Kabul, Afghanistan
Declaration of AuthorshipThis is hereby certified that the study conducted for this volume of thesis is an originalresearch work and has not been submitted for any degree to other universities or institutions.Name: Khorshid HotakRegistration Number: 301-1504002BBA Thesis – Kardan UniversitySupervisor: Dr. Nassir Ul Haq WaniII
ACKNOWLEDGEMENTAll praises to the one and only almighty Allah who has showered from His wisdom andknowledge to His servants. I’m thankful to Him for granting me the knowledge, strength,health and peace of mind to accomplish my Bachelors level and successfully end up with myBachelor thesis which is a part of course work.I respect the patronage and moral support extended with kindness by my parents whose allkinds of support and encouragement enabled me to come up with this work.I offer my sincere gratitude to Ms. Meena Rahmani, Vice Chancellor Academics forpermitting me to conduct this study and my supervisor, Dr. Nassir Ul Haq Wani for impartinghis very precious time, knowledge, constant instructions and suggestions with me.I extent my thanks to each and every person who cooperated in completion of my researchthesis.Khorshid HotakIII
List of AcronymsPolPollutionTITrade IntensitySEScale EffectCEComposition EffectTETechnic EffectIV
AbstractThe melting of icebergs, decomposition of the ozone layer, greenhouse gasses, nuclear wastesaltogether with many other environmental disputes have turned environmental safety andprotection into the priority of environmentalists and governments in the recent decade. Theearth is losing its ability to further back the future generations of all the living species andthe human beings with their immature decisions and inventions are liable for this situation ofenvironment on the Earth. The study investigated the possible impact/impacts of the TradeLiberalization on the environment through applying a simple linear regression model throughOrdinary Least Square (OLS) by utilizing a data period ranging from 2005-2017, byemploying Trade Intensity, and the three effects of trade liberalization: Scale Effect,Composition Effect and the Technic Effect. The findings revealed a negative relationshipbetween pollution and trade intensity and a positive relationship between pollution and theeffects of trade liberalization. Combining the estimates of all three effects yields a somewhatsurprising conclusion that freer trade appears to be good for the environment. Therefore,Afghanistan government should be open to international goods market but accompany tradeliberalization with environmental safety and protection policies in order to enhance andprotect the environment and expand trade.

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