Investigating the effect of carbon footprint on trade balance of OPEC countries with an emphasis on income inequalities

The main objective of this study is to investigate the effect of carbon dioxide gas volume on the trade balance of OPEC countries with respect to the income inequality. The data of all OPEC members in a 15-year period was analyzed using the data panel approach. The results of the estimation of the import function showed with the increase in carbon dioxide emissions, the volume of imports to OPEC countries has not diminished. Due to the degree of income inequality in these countries, the increase of carbon dioxide has a significant negative relationship with the increase in import volumes. As the distance between income deciles in these countries increases, the relationship between increased carbon dioxide and volume of imports tends to reverse. The results of the export function estimation were shown the volume of exports of OPEC member countries does not have a significant relationship with carbon dioxide emissions. With regard to income inequality, there was no significant relationship between countries. Therefore, the volume of exports of OPEC member countries is independent of carbon emissions.