Using balanced panel data of 62 countries (regions) from 1995 to 2011, we explore the linkage between a country’s participation in global value chains (GVC) and its carbon emissions using spatial panel econometric models. We find: First, positive spatial dependency does exist between countries. Second, forward and backward GVC participation has different spatial spillover effects, with the latter causing most of the spillovers. Third, regarding industry heterogeneity, the manufacturing sector generates a stronger spatial spillover than the service sector. High-tech manufacturing sub-industries show stronger spillovers, compared to low-tech sub-industries. Finally, we propose policy suggestions for international relations and environmental governance.

This paper investigates the effects of the European Union Emission Allowance (EUA)’s price on European carbon-intensive industries’ stock returns based on daily data from April 25, 2005 to July 24, 2017. Utilizing a multifactor market model specification and a panel quantile regression approach, the study tests whether the influences of the EUA price on the stock market are heterogeneous and asymmetric concerning each phase. The results show that a significant negative impact of the EUA price on the stock market is found in the middle- and high-return markets during Phases I and III, whereas in Phase II, the impacts are positive. Additionally, no asymmetric feature of the carbon market effect is shown in Phases I and III, but it shows a strong asymmetric effect across quantiles during Phase II. Some factors such as allocation rules and macroeconomic stability may cause this dissimilarity.