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International Waste Trade

Thais Nuñez-Rocha

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Thais Nuñez-Rocha. International Waste Trade. Paris X Nanterre. 2024. hal-04732947

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REVISTA EMPRENDEDORISMO Y
ESTRATEGIA ORGANIZACIONAL

No. 7 año 2013

ISSN 1390 - 5910

<table><thead><tr><th></th><th>Pag.</th></tr></thead><tbody><tr><td>América del Sur: Entre la Dependencia y Seguridad.<br>South America: Between the Unit and Security</td><td></td></tr><tr><td>Oscar Montero, Universidad de las Fuerzas Armadas, ESPE<br>Milton Reyes Herrera, Instituto de Altos Estudios Nacionales.</td><td>1</td></tr><tr><td>International Waste Trade<br>Comercio Internacional De Residuos</td><td></td></tr><tr><td>Thais Nuñes, Dr.(c)</td><td>29</td></tr><tr><td>Las "Nuevas Amenazas" Como Subjetividad Perceptiva<br>The "New Threats" As Perceptual Subjectivity</td><td></td></tr><tr><td>Dr. Hector Luis Saint-Pierre</td><td>39</td></tr><tr><td>Exportation Chain Of Tinplate: An Analysis Of Logistics Costs<br>Cadena de Exportación de Hojalata: Un Análisis de Costos Logísticos</td><td></td></tr><tr><td>Antonio Carlos Breves de Souza, Wellington Leoncio da Costa<br>Dário Moreira Pinto Junior</td><td>51</td></tr><tr><td>Choque Cultural: Estrategias Para Su<br>Identificación y Mitigación<br>Culture Shock: Strategies for Identification<br>And Mitigation</td><td></td></tr><tr><td>Mónica Lucía Santillán Trujillo Ph.D.</td><td>59</td></tr></tbody></table>
<figure><img src="image_2.png" /></figure>

REVISTA EMPRENDEDORISMO Y ESTRATEGIA ORGANIZACIONAL
Ficha No. 532

658.11 E558

Emprendedorismo y Estrategia Organizacional, Sangolquí:

80 Pág. 30cm,

Periodicidad: semestral

Acervo: Nº 7 (Abril 2013 - octubre 2013)

Incluye: Consejo Editorial –Comité Científico – Índice de Contenido

- Misión y Objetivos – Resumen – Palabras Clave – Cuadros – Tablas y
Figuras.

ISSN: 1390-5910

1. ADMINISTRACIÓN

2. EMPRENDEDORISMO

3. ESTRATEGIA
# REVISTA EMPRENDEDORISMO Y ESTRATEGIA ORGANIZACIONAL

## CUERPO DIRECTIVO

### Rector

General de Brigada
Roque Apolinar Moreira Cedeño

### Vicerrector de Docencia

Crnl. EMC William Roberto Aragón C.

### Vicerrector de Investigaciones y Vinculación con la Colectividad

Crnl. Ricardo Urbina

### Director de Departamento de Ciencias Económicas Administrativas y de Comercio

Tcrnl. Fernando Viniachi

### Editor Responsable

José Nicolás Albuja Salazar, Ph.D

### Coordinación Administrativa

Ing. Giovanni Herrera Enríquez

### Diseño y Diagramación

Ing. Juan Carlos Andrade Yanez

### Impresión

Ediespe

## CONSEJO EDITORIAL:

### Consejo Editorial

#### Luis Heriberto Cumbal Flores, Ph.D.

Escuela Politécnica del Ejército – ESPE – Ecuador.

#### Marilyn Rubin, Ph.D.

The City University of New York – CUNY – U.S.A.

#### Maritza I. Espina, Ph.D.

Universidad del Este – UNE – Puerto Rico.

#### Wilson Toshiro Nakamura, Ph.D.

Universidade Presbiteriana Mackenzie -UPM – Brasil.

### Comité Científico

#### Fabrizio Noboa, Ph.D.

Universidad San Francisco de Quito – USFQ – Ecuador.

#### José Nicolás Albuja Salazar, Ph.D.

Universidad de las fuerzas Armadas - ESPE Ecuador.

#### Xavier Vence Deza, Dr.

Universidad de Santiago de Compostela – USC España.

#### Nancy Matos, Ph.D.

Escuela de Administración de Negocios Para Graduados – ESAN – Perú.

#### Hugo Jácome Estrella, Dr.

Facultad Latinoamericana de Estudios Sociales – FLACSO – Sede Ecuador

#### Joshua Onome Imoniana – Ph.D.

Universidade Presbiteriana Mackenzie – UPM – Brasil.
## Misión

La misión de la REEO – Revista Emprendedorismo y Estrategia Organizacional consiste en atender académicos y no académicos y sus necesidades de conocimiento por medio de la socialización de investigaciones de la más alta calidad en los campos de economía, administración y áreas afines y de esta manera cumplir con la sociedad en el sentido de influenciar el futuro.

## Objetivos

### Los objetivos de la Revista son:

a) Divulgar trabajos científicos en las áreas de conocimiento de Economía, Administración y áreas afines;

b) Estimular la creación y la divulgación de textos de profesores y alumnos de los programas de Pregrado y Postgrado de la ESPE y de otras Instituciones de Educación Superior en las mismas áreas de conocimiento.

c) Ofrecer un canal de comunicación para el intercambio de informaciones entre profesionales de las áreas mencionadas, a través de la publicación de contribuciones que se encuadren en las Normas para Publicación de Trabajos de esta revista.

La Revista Emprendedorismo y Estrategia Organizacional, ISSN 1390-5910 es una publicación semestral del Departamento de Ciencias Económicas, Administrativas y de Comercio (CEAC) Editorial Universidad de las fuerzas Armadas - ESPE.

Consultas dirigidas al Editor Responsable José Albuja, Ph. D. email jnalbuja@espe.edu.ec ; Av. Gral. Rumiñahui, s/n. Sangolquí, Ecuador, Campus Universitario, Edificio Académico 2do. Piso, CEAC.
Editorial

Apreciados lectores,

Quisiera de antemano agradecerles por la confianza y fidelidad con que pres-
tigian nuestra revista.

A los autores que gentilmente ofrecieron sus trabajos para la composición de este número de la REEO les presento mis más sinceros respetos y les doy las gracias por enriquecer nuestro conocimiento a través de sus esfuerzos investigativos.

Este número 7 de la Revista Emprendedorismo y Estrategia Organizacional nos trae una selección de trabajos que, con toda seguridad, será una muy gratificante lectura.

El primer artículo “América Del Sur: Entre La Dependencia Y Seguridad”, nos remite a la relación entre América del Sur y EEUU, que han sido parte de un continuo de las relaciones entre el hegemón continental y Latinoamérica y el Caribe. Nos invita a reflexionar sobre el concepto de dependencia y la visión sobre seguridad e interés nacional que ha impulsado la potencia norteamericana. Comenta sobre el intento de los países de la región por romper dicha dependencia y destaca UNASUR como actor principal en ese intento.

El segundo trabajo “International Waste Trade” nos alerta sobre las implica-
ciones, tanto ambientales como en salud, del Comercio Internacional de Residuos-
IWT en los países importadores, enfocando en la Unión Europea. Manifiesta que la
diferencia en el rigor de las regulaciones ambientales locales entre los socios del IWT
será la clave del controlador de las bolsas de residuos, lo que llevará inevitablemente
a la aparición de paraísos de residuos.
A seguir presentamos el trabajo “Las “Nuevas Amenazas” Como Subjetividad Perceptiva”, que discute el término “Amenaza” afirmando ser relativamente reciente y todavía poco usado. Hace referencia a una preocupación estratégica de las Fuerzas Armadas y detrás de su surgimiento está implícita las limitaciones del concepto negativo de “Seguridad” que llegó a designar la doctrina que orientó los aparatos represivos latinoamericanos en sus acciones sangrientas aún demasiado presentes en la memoria regional.

A continuación, presentamos el artículo “Cadena de Exportación de Hojalata: Un Análisis de Costos Logísticos” que ofrece un análisis de las herramientas y los costos de logística en la cadena de exportación de la hoja de metal - también conocida como la hojalata, un producto utilizado principalmente para empaques, especialmente en la industria de alimentos. La investigación arrojó resultados interesantes y uno de ellos es que solamente una de las empresas encuestadas mostró valores cuantificados en los costos de logística.

Finalizando esta edición, exhibimos el artículo “Choque Cultural: Estrategias Para Su Identificación Y Confrontación”, cuya temática es bien interesante y actual porque trata de los obstáculos a los cuales se enfrentan las personas que cambian para un nuevo ambiente, con costumbres y tradiciones diferentes.

Es una satisfacción ofrecer, a través de los artículos antes mencionados, un conocimiento actualizado y de interés para la comunidad.

José Nicolás Albuja Salazar, Ph.D.
Editor Responsable.
Editorial

Dear readers,

I would like to thank you in advance for the trust and loyalty to our journal.

To the authors who kindly offered their work for the composition of this issue
of the REEO I must present my most sincere respect and thank them for enriching our
knowledge through their research efforts.

This number 7 of Emprendedorismo y Estrategia Organizacional' Magazine
brings us a selection of works that surely will be a very rewarding reading.

The first article "South America: between unity and security" reminds us of the relationship between South America and the U.S., who have been part of a continuum of relations between continental hegemony and Latin America and the Caribbean. It invites us to reflect on the concept of dependency and vision about security and national interest that has driven American power. Comment on the intention of the countries of the region to break this dependency and highlights the UNASUR as a key player in that effort.

The second work, "International Trade Waste" alerts us to the implications, both environmental and health, International Trade Waste IWT in importing countries, focusing on the European Union. Is that the difference in the stringency of environmental regulations among local partners IWT will be the key driver of waste bags, which will inevitably lead to the emergence of waste havens.

Following that, the work "New Threats "As Perceptual Subjectivity" discusses the term "threat", claiming to be relatively recent and still little used. It relates to strategic concern of the Armed Forces and behind its emergence it is implicit the li-
mitations of the concept “Security” which came to designate, in the past, the doctrine
that guided repressive Latin American devices in their bloody actions still too present
in the regional memory.

Here is the article “Exportation Chain of Tinplate: An Analysis of Logistics Costs” which provides an analysis of the tools and logistics costs in the export chain of sheet metal - also known as tinplate, a product primarily used for packaging, especially in the food industry. The research yielded interesting results and one of them is that only one of the companies showed quantified values in the logistics costs.

Finalizing this issue, the article “Choque Cultural: Estrategias Para Su Identificación Y Confrontación”, whose subject is very interesting now because it deals with the obstacles people face when switching to a new environment, with different habits and traditions.

I am very pleased to offer, through the afore mentioned papers, a updated
knowledge and interest to the community.

Albuja José Nicolás Salazar, Ph.D.
Responsible Editor.
<figure><img src="image_3.png" /></figure>
INTERNATIONAL WASTE TRADE
COMERCIO INTERNACIONAL
DE RESIDUOS

Thais Nuñes
Master's thesis - University
Paris X 2012
Email: thaisnunez@gmail.com

Resumen

Este artículo trata sobre el Comercio In-
ternacional de Residuos. Vamos a analizar los
determinantes esenciales que impulsan las im-
portaciones de residuos. Nuestro enfoque es la
Unión Europea y observaremos el papel de la
regulación ambiental en la dinámica del comer-
cio. El comercio de residuos tiene algunos de-
terminantes directos, pero algunos otros no son
tan evidentes. La evidencia empírica que surge
es el crecimiento rápido y significativo del co-
mercio internacional de residuos. Esto plantea
la cuestión del impacto de los residuos en el
ambiente y salud del país importador. Hay dos
posibles resultados de este tipo de comercio: el
comercio internacional de residuos podría ser
un instrumento de desarrollo sostenible, o por el
contrario, contribuye a la degradación del medio
ambiente global de países pobres. Actualmente,
existen dos lógicas económicas opuestas. Si la
exportación de los residuos se debe a los retos
tecnológicos, especialmente si el país importa-
dor tiene una mejor tecnología para el tratamien-
to de residuos, los residuos se importan como
un bien que es valioso y reciclable, entonces, el
Comercio Internacional de Residuos (IWT) es
virtuoso. En este caso, los principales determi-
nantes del IWT serán el precio de las materias

primas primarias y secundarias, así como la ofer-
ta técnica y financiera de las industrias verdes
(Bernard et al, septiembre, 2012). Sin embargo,
si la exportación de residuos se debe a la búsque-
da de una solución al problema del tratamiento
local y la eliminación de desechos en el menor
costo económico, independientemente del desti-
no físico de estos residuos, el IWT es entonces
una amenaza para los recursos naturales y para
la salud de la población del país importador. En
su caso, la diferencia en la severidad de las regu-
laciones ambientales locales entre los socios del
IWT será la clave del controlador de las bolsas
de residuos. Esto llevará inevitablemente a la
aparición de paraísos de desecho. En el contex-
to de este trabajo, se muestra empíricamente las
tendencias de estos dos planteamientos dentro
de la Unión Europea, con el objetivo específico
de proporcionar más información a los responsa-
bles políticos en los reglamentos ambientales y
el comercio de residuos.

Palabras Clave: residuos peligrosos, comercio internacional, Modelo de Gravedad, Paraíso de Residuos, Contaminación.

Abstract

This paper is about the International
Waste Trade. We are going to analyze the essen-
tial determinants that drive the imports of waste.
Our focus is the European Union and we will
observe the role of the environmental regula-
tion in the trade dynamics. Waste trade has some
straightforward determinants, but some others
are not so obvious. The empirical evidence that
emerges is the rapid and significant growth of in-
ternational waste trade. This raises the question
of the environmental and health impact of waste
in the importing country. There are two possi-
ble outcomes for this kind of trade: international
waste trade could be an instrument of sustaina-
ble development, or on the contrary, it contribu-
tes to the degradation of the global environment
of poor countries. Currently, there are two opposite economic logics. If the export of waste is due to technological challenges, especially if the importing country has better technology for waste treatment, waste is imported as a good that is valuable and recyclable, then the International Trade Waste (IWT) is virtuous. In this case, the main determinants of the IWT will be the price of raw primary and secondary materials, as well as technical and financial offer of the green industries (Bernard et al, september, 2012). However, if the export of waste is due to the search for a solution to the problem of local treatment and disposal of waste at least economic cost, regardless of physical fate of these wastes, the IWT is then a threat to natural resources and to the health of the population of the importing country. Where applicable, the difference in severity of local environmental regulations between IWT partners will be the driver key of waste exchanges. This will inevitably lead to the emergence of waste havens. In the context of this paper, we show empirically the trends of these two approaches within the European Union, with the specific objective of providing more information for policy makers in environmental regulations and waste trade.

**Keywords:** Hazardous Waste, International Trade, Gravity Model, Waste Haven, and Pollution.

**Introduction**

The interest in waste trade, and especially the dynamics present in the European Union (EU), stands on two pillars.

First is that the European Union is an area that has always been at the forefront of environmental concern. She leads a common policy to preserve and improve the quality of the environment. One example: this is the only region to have taken great commitments to reduce greenhouse gas emissions effects with the

Kyoto Protocol. European policy in this area is based on two main principles: the polluter-pays principle and the precautionary principle. The actions of the European Union are mainly concentrated around the issues of climate change and global warming on the environment link, health and development of the natural habitat, wildlife and wild flora, natural resources and better waste management. Protecting the environment is a fundamental factor in many other EU policies: agriculture, fisheries, transport, and industry (Training Centre on European institutions, 2007).

Second, we see that the international waste trade is growing very fast. This very rapid and significant growth raises the question of its impact on the environment. The waste exchange in physical volume increased between 2003 and 2010 in 57%, which has a small slowdown in growth of 67%, observed between the five years 2002 and 2007 cause of international crisis, (UNComtrade, April 2012)[1] . Europe is a major player in international trade, particularly in the international waste trade, especially when the two opposing theories about the incentives of waste trade are analyzed. On the one hand, the waste imports can be positive for the importing country when the country has better technology providing treatment or recycling of waste at lower economic and environmental costs, in that case IWT is virtuous. On the other hand, if the export is due to the search for a solution to the local problem of treating and recycling, sending the waste to another country to do it at a lower cost, taking advantage of poor environmental performance of the treatment facilities in importing countries, trade is then a danger to natural resources and health (Bernard et al, 2012). This is known in the literature as waste havens.

In the case of waste trade within the European Union, specifically hazardous waste, we see that actually the amount sent from poorer countries to richer countries is higher then the amount sent in the opposite direction, but the
rate of growth of this trade is greater in the case of imports of hazardous waste. It means that soon enough the poorer countries will be impor- ting more hazardous waste then the richer, and that could be a problem if the environmental re- gulations of those countries do not grow at the same pace.

We will analyze this phenomenon using a Gravity Model of Trade, within variables that help us explain better the determinants of these paths. Examining the environmental regulation on the dynamics of waste trade, we will test the hypothesis of the formation or not of waste ha- vens in the poorer countries of the EU. The re- sults provide a means to assess the current situa- tion and give some guidelines for environmental policy in the different countries of the European Union.

Waste Trade

The International Waste Trade (IWT) is large and has increased in the last decade, yet the literature has focused instead on pollution havens (the movement of capital goods with po- lluters products to countries with weaker envi- ronmental regulations) (Kellenberg 2011). The literature is somehow divided over this issue ha- ving two different conclusions. (Kellenberg et Levinson 2012; Kellenberg 2011; Brunault 2011; Bags 2009). There are those who assure that waste is sent to developed countries because those countries have more advanced technology to treat them, on the other side are those who assure that, when the environmental regulations become more stringent in developed countries, it is more attractive to send the waste to coun- tries with weaker environmental regulations, to be treated or disposed there, simply because is cheaper.

The waste in weight traded only in the European Union was of 23% in the period 2003- 2010. However, what is interesting is that the percentage of waste imports on total imports in-

creased in about 33% in the same period.

For example, as Kellenberg mentioned in his paper Trading Waste, the net weight of cars traded globally was of 41 million tons, less than 22% of the total net weight of waste exchanged. While a good part of this waste was sent to fore- ign markets for recycling or to make some kind of recovery, there is growing evidence sugges- ting that waste is sent to countries with lax envi- ronmental regulations, implying the existence of waste havens effect. The economic intuition of this phenomenon is that: the fixed costs of mo- ving infrastructure capital-intensive industries are greater than any cost "saved" to work in a country with a lower environmental regulation. The cost of the waste exported to foreign cou- ntries with lower environmental regulation, can be less expensive than moving production faci- lities to foreign countries with weaker environ- mental regulations. It also defines the distinction between waste and pollution havens effects.

Increasing the stringency of environ- mental regulation, in the exporting country, will traduce in a rise of the treatment costs of the waste produced locally. Consequently, with every other variable constant, this could induce an increase on exports of waste to avoid local stronger regulations. This means that, if ever a significant proportion of waste is a by- product of consumption, the most stringent environ- mental regulations in open economies may lead countries to export their waste to countries with less stringent regulations. The consequences of sending waste to poorer countries, which are ge- nerally those with less stringent environmental regulations, could be quite severe especially for those who are not well equipped to manage the recovery, recycling or disposal of these materials which are commonly toxic, and this leads us to wonder about the social inequalities that can be created or worsened by the IWT.
## Waste Trade in the European Union

In this master thesis, we confirm that the involvement of the EU in the waste trade is quite important. It represents the 32% of all trade in 2010. So, knowing that the contribution of the European Union's total trade in the same year was 21%, we may see clearly the relevance of the region in the waste trade. What is rather interesting is the fact that in the period 2003-2010 the volume and value have increased. Evidently it is clear that the volume has increased in around less than 36% (which is quite high if we take into account that trade of all goods in volume increased 6.7%) but the value has increased significantly by 138%, which is much higher than the increase of global trade of 25%.

<figure><img src="image_4.png" /><figcaption>Figura 1.</figcaption></figure>

Source: Database, matching the Basel Convention and UNComtrade Dussaux and Brunault.

In this research, we are working with twenty-seven countries of the European Union. We will divide it, into two groups, by their level of income. The richest are the founding members of the Union following fifteen countries: Germany, Austria, Belgium, France, Italy, Luxembourg, the Netherlands, Denmark, Ireland, the United Kingdom, Greece, Spain, Portugal, Finland, Sweden, and the group of the less rich are Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Czech Republic, Slovakia and Slovenia, and since 2007, Bulgaria and Romania.

There is statistical evidence showing that the richer countries import in level more hazardous waste and non-hazardous waste than poorer countries. What reassures and evoke us the fact that the European Union could be actually one example where the waste trade is virtuous.

Yet when we look a little deeper into the data and we analyze the rate of growth of these imports, we see that, indeed, non-hazardous waste maintain the same trend, but what is interesting enough are the dynamics of the imports in hazardous waste. There is a persisting increase in the growth rate of imports that can lead us to suspect that in this case there can be perhaps wrong with the logic of “virtuous” waste trade.
<figure><img src="image_5.png" /><figcaption>Figura 2.</figcaption></figure>

Source: Database, the author.

To illustrate this idea, we have developed the graphic above which clearly shows the motivation of the research. If the amount of hazardous waste sent to rich countries from poor countries remains the same, but the shipments from rich to poor will continue to increase in the following periods (as we see in the graph) poor countries will receive more hazardous waste then the rich ones, which is very interesting to study in the perspective of waste havens effect.

lateral) at a period t (years) exist the imports of waste traded in terms of weight Ytijd, where the subscript d, if it exists, then d=1 corresponds to dangerous waste and d=0 denotes non dangerous waste. The waste traded Ytijd, which is our variable of interest is obtained by taking the sum for the waste weight for each d thus:

$$Y_{tijd} = \sum_{d=0}^{1} Y_{tijd} / n_{k \neq l}$$

## Data

We dispose of a dataset obtained from 215 countries at yearly frequency for the period 2003-2010. In this research, we are going to concentrate ourselves on trade made between the twenty seven countries of the EU. Our variable of interest is the waste in weight traded. We are working with the imports (because it is well known in the literature for being more reliable). Now suppose i and j are two different countries trading. Then for each couple of countries ij (bi-

Where nk is the number of ij at t in d=0. We also consider three groups of explanatory variables, where the first two groups correspond to the gravity variables (or resistance terms, as known in trade literature) Vtijd: GDP, area (territory), population etc. and bilateral gravity variables Wtijd: distance, common language, share common border etc. The second group consists of two variables, which are proxies for environmental regulation and cost of waste treatment (reuse or recycle) and finally a group of fixed effects.
The panel data used in this research is a matching from the two principal sources of waste trade, the Basel Convention and the Harmonized System (HS6) of the United Nations Comtrade (Brunault, Dussaux, 2011) [2] Additionally, we use the gravity data from a compelling dataset developed at CEPII [3]. In this paper, we are using observations that represent the 99% of the total waste legally traded and we are leaving out of consideration the countries or territories that are not considered in the gravity data, that represents less than 1% of the waste trade registered.

## The empirical Strategy

Supported in the late literature, we are using the waste weight traded because that makes more sense in an environmental perspective, where the magnitude of the item traded is more important than its value (Kellenberg, 2012) (that in some cases can be negative). This data presents all legal transboundary shipments registered by both systems [4].

My contribution to the literature with this paper is the work with both sources of waste trade data and the usage of panel data. As well I will use an autoregressive model to calculate the growth rate of waste imports, which has some positives aspects and so negative aspects. The positive side of this, is that we can analyze the dynamics in a growth rate perspective, and the negative side is that we should do a more extensive study of the econometrical problems that can be found in this type of models, specifically bias, heterogeneity and not zero inclusion, unfortunately that is going to be studied in a further work, so it will be the limit of this research.

## Results

We have made two types of regression in this study, the first one was a simple regression where we only put the gravity variables and the

variables of interest in the model, and subsequently, we analyzed the impacts when using fixed effects, using three forms to the fixed effects as you can see in the table.

## Simple gravity model

In this first regression, we can see that the variable distance, which is one of our main variables in the gravity model is significant, negative and close to one, which is reassuring as it according the predictions of the literature.

The rest of our variables are significant except the language, because in the European Union there are very few countries that speak the same language. But on the contrary, there are some languages that are spoken by a minority that can be a language spoken on another European country.

All variables in the model are significant at 1%, except the Relative Environmental Regulation variable RR that is significant only at 5%. Another fact that is reassuring is that we found the correct signs as gravity models predict, namely the competition between "two competing forces determine the intensity of trade between countries: attractive forces (income and size countries) and the forces of resistance (distance and other barriers to trade)" (Fontagne et al, 2002).

Consequently, we will make a brief comment on the signs of the variables studied. Initial endowments of a country or wealth, understood as GDP, obviously has a positive influence in trade, and then we find that the coefficient of the country's wealth is positive. The Relative Environmental Regulation variable RR [5] has a negative sign, because the more increases the difference of environmental regulation between importing and exporting countries, the imports are going to decrease, or are going to go to countries that have an environmental regulation less strict.
<table><caption>Tabla 1.</caption><thead><tr><th colspan="6">Regresion International Waste Trade (Imports)</th></tr><tr><th rowspan="2">Regression of</th><th colspan="4">Growth rate of total imports</th><th>Robustness test</th></tr><tr><th>1</th><th>2</th><th>3</th><th>4</th><th>5</th></tr><tr><th></th><th>Growth rate of imports as a function of RR, RC Int Rrpoverty</th><th>Growth rate of imports as a function of RR, RC Int Rrpoverty</th><th>Growth rate of imports as a function of RR, RC Int Rrpoverty</th><th>Growth rate of imports as a function of RR, RC Int Rrpoverty</th><th>Growth rate of imports as a function of RR, GDP per capita Int Rrpoverty</th></tr></thead><tbody><tr><td>Constant</td><td>3,007<br>0,000</td><td>5,473<br>0,839</td><td>5,131<br>0,000</td><td>2,548<br>0,000</td><td>4,017<br>0,000</td></tr><tr><td>Rel. Regulation</td><td>-0,717<br>0,014</td><td>-0,797<br>0,011</td><td>0,563<br>0,061</td><td>-0,575<br>0,053</td><td>-0,858<br>0,003</td></tr><tr><td>Reciclying cost</td><td>0,099<br>0,006</td><td>0,067<br>0,089</td><td>0,134<br>0,000</td><td>0,074<br>0,032</td><td>0,135<br>0,002</td></tr><tr><td>Int. RR &amp; poverty</td><td>1,095<br>0,005</td><td>1,200<br>0,003</td><td>1,154<br>0,004</td><td>1,214<br>0,002</td><td>1,166<br>0,003</td></tr><tr><td>Dummy dangerous</td><td>-0,933<br>0,000</td><td>-0,923<br>0,000</td><td>-0,512<br>0,000</td><td>-0,330<br>0,000</td><td>-0,991<br>0,000</td></tr><tr><td>Yt-1</td><td>0,707<br>0,000</td><td>0,716<br>0,000</td><td>0,804<br>0,000</td><td>0,845<br>0,000</td><td>0,699<br>0,000</td></tr><tr><td>Xi (country specific characteristics)</td><td>yes</td><td>yes</td><td>no</td><td>no</td><td>yes</td></tr><tr><td>Xin (bilateral characteristics)</td><td>yes</td><td>no</td><td>yes</td><td>no</td><td>yes</td></tr><tr><td>Bilateral Fixed Effects ij</td><td>no</td><td>no</td><td>no</td><td>yes</td><td>no</td></tr><tr><td>Fixed Effects it/jt</td><td>no</td><td>no</td><td>yes</td><td>yes</td><td>no</td></tr><tr><td>Time fixed effects t</td><td>no</td><td>yes</td><td>yes</td><td>yes</td><td>no</td></tr><tr><td>Observaciones</td><td>5320</td><td>4497</td><td>4637</td><td>4880</td><td>5202</td></tr><tr><td>R2</td><td>0,773</td><td>0,7769</td><td>0,7655</td><td>0,7618</td><td>0,776</td></tr><tr><td>F</td><td>1641,44</td><td>1114,75</td><td>1372,65</td><td>1946,78</td><td>1380,08</td></tr></tbody><tfoot><tr><td colspan="6">P-values<br>down from 0,009 significative at 10%; down from 0,099 significative at 5%; down from 0,999 significative at 1%; up to 0,100 not significative</td></tr></tfoot></table>

About the variable Interaction of the Relative Regulation and Poverty of countries (Int. RR poverty) the coefficient is positive and outweighs that of RR which tells us that the bigger is the difference of environmental regulations between the importing and exporting countries, more poor countries are going to import waste.

The sign of the binary variable for hazardous waste is negative because imports of hazardous waste grow at a lower rate. The lagged variable of imports is positive, by construction,

and because intuitively when there are more imports in the previous period, the greater will be the current imports in a normal economy.

According to the results of the literature of international trade, as shown for example Anderson and van Wincoop (2003), Santos Silva and Tenreyo (2009) or Helpman et al., it is important to control for unobserved heterogeneity in the importing and exporting countries when using a gravity model. For this reason, we will pass to the specification with fixed effects.
Gravity model with fixed effects

We now add the set of fixed effects variables in the equation of gravity models, first with individual country fixed effects and time, after time with country fixed effects and finally with time and country fixed effects and bilateral fixed effects. The results are quite similar to those already discussed and the interpretation is the same. The significance changes slightly between the variables of interest, but all are still significant.

Robustness tests of the dependent variable

There are several ways to test the robustness, but in the context of this master thesis, we will only change the variable for the recycling cost by GDP per capita. The results were satisfactory.

Conclusions

A key finding of intra-European trade is that we can actually see that there is a significant increase on imports of waste for both rich and poor countries, which is consistent with studies by Baggs and Kellenberg.

In the study of Baggs, he worked with hazardous waste, as was observed in the graph of the growth rate of imports of hazardous waste, the growth rate of poor countries is more important. So we have to analyze in a dynamic way, because, although the imported level for rich countries is higher in the level, the growth rate of imports from poor countries is bigger, which can have bigger consequences in the long term. This tells us that in a near future these countries may become waste havens from rich countries of the European Union, especially because the evidence tells us that the growth rate of the environmental regulation is not increasing, as fast as the imports to compensate this trend.

Another issue that must be considered is

that, indeed, in this research, we show that there is an increase in the difference of Environmental Regulation which involves an increase in imports of waste for the country that has a low environmental regulation. That is consistent with the hypothesis of waste havens created by Kellenberg. Also, the percentage of imports from these countries is very large relative to their wealth expressed in GDP. Especially if we take into account that in the countries that have a greater percentage of waste imports by GDP, three are considered in this study as "poor" countries and four are considered as "rich" countries, but they have suffered a recent loss because of the global crisis. And the rest of the countries are those with a high GDP.

We can also conclude that there are rich countries importing more waste because of their high technology developed, thanks to their increasing environmental regulations. Then they can receive waste and it would be virtuous for them and for all countries, that can afford to dispose in those countries their wastes.

As an extension of this work, it would be interesting to do the same analysis but removing countries that are major players in trade, such as Germany and Poland, to see the robustness of the current analysis. Another interesting extension would be to see specific dynamics of waste imports from countries of the European Union, which are depleted in recent years. These countries are considered in this study, as rich as they were part of the Union since its creation. But global economic conditions and the crisis, have greatly affected them in recent years. It was found in this study that they play an important role on the IWT.
## Notes

1. Based on data from: UNComtrade to April 2012.

2. This data was created an updated by Luc Brunault and Damien Dussaux

3. For its french abbreviation of Center of international studies, prospectives and information

4. http://comtrade.un.org and http://www.basel.int

5. Calculate in the traditional way according to the literature Eji={(Ej-Ei)/[(Ei+Ej)/2]}

## References

Anderson and Van Wincoop. (2003). Trade Costs Model.

Article L541-1. Amended by Act No. 2003-591 of 2 July 2003 - art. 31 (V) Official Journal of 3 July 2003. For more information see Appendix 1.

Baggs, J. (2009). International Trade in Hazardous Waste. Review of International Economics,17(1).

Basel Convention (1989). Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal by the Conference of the Plenipotentiaries on 22 March 1989.

Basel Convention, Unep (2008). The on-line reporting database of the Basel Convention. Basel.

Bernard, S., Dussaux, D., Glachant. Mouez. M. F. International trade in waste. World Economy. CEPII.

Brunault, L. (2011). The Basel Convention and International Trade: An Empirical Analysis of Trans-boundary Movements of 2011.

Commission Of The European Communities (2009). Report on the implementation of Council Regulation (EEC) No 259/93 of 1 February 1993 on the supervision and control of shipments of waste Within, into and out of the European Community. Commission Staff Working Document. Brussels.

Fontagne L., Pajot, M., Pasteels, J.M. (2002). Potential trade between heterogeneous economies: a little manual of gravity models. Cepii. Economic Review and Forecast No. 152-153.

Helpman E. Melitz M., Rubinstein, Y. (2008) Estimating trade flows: trading partners and trading volumes. Harvard University. Quarterly Journal of Economics 123, no. 2.

Kellenberg, D. (2010). Trading Wastes. University of Montana, USA. Article pre-publication in 2010.

_______ (2012) Trading Wastes, Journal of Environmental Economics and. Management.

Kellenberg, D. and Levinson, A. (2012). An effort for nothing? The International Environmental Agreements and Trade.

Santos Silva, JMC and Tenreyo, S. (2006). Fish Pseudo-Maximum-Likelihood Model. The Review of Economics and Statistics.

_______ (2009) Further simulation evidence on the performance of the Poisson pseudo-maximum likelihood estimator. University of Essex, London School of Economics. Article pre-publication in 2009.

Training Centre on European institutions (2007). http://www.strasbourg-europe.eu/environment.23911.en.htm.

World Bank (2007). World Development Indicators. World Bank: Washington DC.
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