International Journal of Economics and Financial

Issues
ISSN: 2146-4138

available at http: www.econjournals.com

International Journal of Economics and Financial Issues, 2022, 12(4), 97-105.

Impact of Green Logistics on International Trade: An Empirical

Study in Asia – Pacific Economic Cooperation

Thu-Hien Le1, Huu-Kien Nguyen2*, Thanh-Vu-Linh Nguyen2, Thi-Mai-Huong Khuat3,

Thi-Phong-Thu Pham3, Thuong-Lang Nguyen2

Faculty of Economic Mathematics, National Economics University, Hanoi, Vietnam, 2School of Trade and International Economics,
1

National Economics University, Hanoi, Vietnam, 3School of Advanced Education Programs, National Economics University, Hanoi,
Vietnam. *Email: [email protected]

Received: 01 April 2022 Accepted: 22 June 2022 DOI: https://doi.org/10.32479/ijefi.13185

ABSTRACT
Green logistics has been a trend in the world. This research evaluates the impact of green logistics on international trade among APEC nations
over the period of 9 years (2010-2018). The research uses an augmented gravity m€€odel to investigate the effects of green logistics on
international trade through the environmental logistics performance index (ELPI). The results show that exporting countries applying green
logistics increase the export volume to other members of APEC. In the long term, importing countries engaging in green logistics increase
trade volume with green logistics countries in APEC. With the aim of enhancing international trade, APEC countries must improve domestic
logistics performance. Through those analyses, research proposes several recommendations to encourage nations and enterprises to apply
green logistics effectively.
Keywords: APEC, FGLS, Green Logistics, International Trade
JEL Classifications: F13, F18, L98

1. INTRODUCTION largest GHG-emitting economies were APEC members (APEC

Policy Support Unit, 2021). To achieve the goal at COP 26, APEC
Logistics has been being developed, which plays an essential needs to make a lot of effort including applying green logistics,
role in the economic development of many countries, including solving the APEC’s emissions problem. Therefore, it is necessary
international trade competitiveness (Bensassi et al., 2015). to research and make assessment of green logistics’ impacts on
However, the logistics industry consumes a large number of energy international trade within APEC.
resources and generates high carbon emissions. The estimated
level of CO2 from the logistics accounts for 13% of total global
The research uses the quantitative research method by ordinary
emissions (World Economic Forum, 2016), causing negative
impacts on the environment and society. Therefore, applying green least squares regression (Pooled OLS), fixed-effects model
logistics is the solution to solve these problems. (FEM), random-effects model (REM), and feasible generalized
least squares (FGLS). From that, the research proposes
As a global forum, however, APEC’s greenhouse gas emissions recommendations for governments and enterprises to apply green
account for 60% of the world. Not only that, 6/10 of the world’s logistics effectively.

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 Le, et al.: Impact of Green Logistics on International Trade: An Empirical Study in Asia – Pacific Economic Cooperation

2. LITERATURE REVIEW AND They are constrained by a group of physically proximate nations
such as the south Asian association of regional cooperation
THEORETICAL FRAMEWORK
(SAARC) and the European union (EU), notwithstanding
international trade expansion, which provides an opportunity for
2.1. Literature Review
research to inherit the scientific value of such efforts while also
The studies on logistics have been being conducted primarily from
broadening the scope to include APEC nations.
a macro viewpoint to improve the business environment for the
global supply chain and from a micro to evaluate the impact of
green regulations on the region, industry, or business. 2.2. Theoretical Framework
2.2.1. Logistics and green logistics
It has been suggested that logistics has a wide-ranging impact “Logistics is understood as a network of services that support
on trade. Bilateral trade is connected to logistics performance the physical movement of goods, trade across borders, and
index (LPI). Efficient logistics services minimize the effect of commerce within borders. It comprises an array of activities
geographical distance but do not completely eliminate it (Arvis beyond transportation, including warehousing, brokerage, express
et al., 2007). GDP and geographical distance between two nations delivery, terminal operations, and related data and information
are followed by LPI which has a significant influence on trade, management” (World Bank, 2018).
mainly of the exporting country (Puertas et al., 2014). Using data
from 112 countries and Hong Kong from 2007 to 2014, Wang Logistics plays an important role in trade which reduces
et al. (2018) discovered that the export and import country LPI transportation costs and stimulates growth (Bugarčić et al., 2020).
is positively correlated with trade; green logistics in exporting The combination of logistics and economic liberalization increase
countries is positively correlated with export volume; green the trade volume (Hausman et al., 2013). Logistics has a positive
logistics in importing countries has an negative relationship with effect on economies of scale, production and growth (D’Aleo and
export volume. Sergi, 2017).

Green logistics and economic development are inextricably Green logistics is environmental-friendly, including greening of
linked to each other (Arvis et al., 2007; Marti et al., 2014; various processes in logistics such as transportation, warehousing,
Bensassi et al., 2015; Aldakhil et al., 2018). The environmental distribution, waste treatment and green recycling (Wu and Dunn,
issues generated by logistics drive governments to impose 1995). It strictly adheres to green consumption and production
additional rules on the exchange of products. The selling standards, to a greater extent the national capacity index for
commodities to foreign nations are certain to deal with regulatory environmental protection. The purpose of green logistics is to
isssues (Ojala and Elebi, 2015; Omar and Zallom 2016; das achieve a sustainable balance among economic, environmental
Chagas et al., 2018). The “non-green” logistics system limits the and social benefits (Dekker et al., 2012).
chances for products exported and customs cleared (Werikhe and
Jin, 2016). Green logistics solutions alleviate social problems Green logistics is an important and ideal policy choice to promote
and have a favorable association with economic indicators and global sustainability by assessing the environmental impact of
environmental sustainability (Khan and Qianli, 2017; Wang logistics on sustainability (Chunguang et al., 2008). Better green
et al., 2018; Nassani et al., 2017). The increase in emissions logistics efficiency reduces transaction costs and eliminates
leads to the increase in volume of commodities and logistical inefficiencies in traditional shipping and handling operations.
services exchanged (Zaman and Shamsuddin, 2017).
2.2.2. International trade and APEC
In Vietnam, there have not been many studies on green logistics. International trade is a trade of goods and services in which the
Most of them use qualitative methods and have not been in- exchange takes place between entities from foreign countries
depth in relation between green logistics and international (Đurović et al., 2010, as cited in Grozdanovska et al., 2017).
trade. Five groups of factors affect logistics development The four major areas of international trade are goods, services,
in Vietnam, including legal framework, and administrative investment, and intellectual property rights. It plays an important
procedures; human resources; infrastructure; logistics role in the development and the growth of the world economy. In
enterprises; technology, and commodity exchanged (Nga, international specialization and division of labor, countries can
2021). Vietnam has its own potential to develop green logistics make efficient use of the resources derived from international trade.
and become a regional logistics center, but there are several International trade increases production capacity and stimulates
limitations such as small business size, shortage of capital, lack consumption, technology transfer, and investment, which supports
of high-quality human resources; weak retail supply services; growth.
poor infrastructure conditions; (Bac, 2015). Green logistics
development is an inevitable trend; and modern information APEC is an economic cooperation forum between countries in
technology system has a significant contribution to logistics the Asia-Pacific region to strengthen economic and political ties
and the level of logistics greening (Anh, 2020). (Canada and the Asia-Pacific Economic Cooperation (APEC),
2021). Established in November 1989, APEC has 21 members,
Green logistics studies are numerous in general, but they all focus including Australia, Indonesia, Malaysia, South Korea, Thailand,
on examining the correlation between logistics and environmental Brunei Darussalam, United States, Japan, Singapore, New
sustainability, as well as logistics and per capita income or FDI. Zealand, Canada, Philippines, China, Peru, Hong Kong, Taiwan

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 Le, et al.: Impact of Green Logistics on International Trade: An Empirical Study in Asia – Pacific Economic Cooperation

(ROC), Mexico, Chile, Papua New Guinea, Russia and Vietnam. and Ekins, 2005) as a measure of logistics efficiency and
According to the APEC in Chart 2021 report, APEC accounts for environmental performance. This is an effective scale for
38% of the global population (in 2020), 62% of global GDP, and evaluating logistics’ sustainability and environmental friendliness
48% of total trade in goods and services (in 2020). The top six (Khan et al., 2016). Eco-efficiency is stated mathematically
economies in the region include: The United States, China, Japan, (Verfaillie, 2000):
Canada, Russia, and South Korea.
Product or service value
Eco − efficiency =
Environmental influence
3. METHODOLOGY
As a result, ELPI is represented in the equation:
3.1. Research Model and Hypothesis
3.1.1. Gravity model ELPI =
Logistics performance
Tinbergen (1962) firstly introduced a gravity model with three Environmental impacts
variables affecting trade between any two economies as follows:
LPI indicates logistics efficiency while the logistics CO2 emission
1. The export turnover of a country is determined by its economic
index (LCC) shows the negative impact of logistics on the
size (its GDP)
environment, so the ELPI equation has been revised as follows:
2. The turnover sold to a specific country varies with the size of
that country’s market (GDP of the importing country) LPI
3. The trade turnover is affected by transportation costs ELPI =
LCC
(corresponding to the geographical distance between the two
countries). Transportation accounts for 80-90% of logistics carbon emissions
(McKinnon, 2010). For this reason, the study uses CO2 emissions
The equation is written as follows: from transportation with secondary data source from Our World in
Data as representative of LCC. Because of economic development
EXPei = α0 GDPe α1 GDPi α2 Deiα3 (*) discrepancies across nations, it is inappropriate to describe
logistics’ environmental performance by using LCC alone (Lu
in which EXP ei is the export turnover from the exporting et al., 2019). Hence, LCC per unit of GDP has been applied to
country to the importing country. GDPe and GDPi are the GDP investigate CO2 emission intensity in logistics:
of the exporting and importing country, respectively. Dei is the
LCC
geographical distance between 2 countries. α0 is a constant and Logistics CO2 intensity ( LCI ) =
α1 α2 α3 are the parameters. GDP

In consumption:
The linear form of the equation (*) is as follows:
LPI
lnEXPei = α0+α1 lnGDPe+α2 lnGDPi+α3 ln Dei+ ε ELPI =
LCI
With ε is the random error.
3.1.3. Hypothesis
3.1.2. Proposed research model There is widespread consensus among researches that LPI
Developed from the gravity model, two regression models and its components have a positive and significant impact on
evaluating the impact of LPI and green logistics on trade, the trade flows across all regions (Marti et al., 2014; Uca et al.,
details of each variable are explained in Table 1: 2016; Bugarčić et al., 2020). The logistics performance index
is positively correlated with export orientation (exports as a
lnEXP = β0+β1lnGDPe+β2lnGDPi+β3POPe+β4POPi+β5D+β6lnL percentage of GDP) (Chakraborty and Mukherjee, 2016), while
PIe+β7lnLPIi+β8lnRQi+β9PSi+β10 BOR+β11 LANG+ε (1) the quality of logistics infrastructure significantly affects regional
export flows (Bensassi et al., 2015). Wang et al. (2018) conclude
lnEXP = β0+β1lnGDPe+β2lnGDPi+β3POPe+β4POPi+β5D+β6lnE that the LPI of importing and exporting countries is positively
LPIe+β7lnELPIi+β8lnRQi+β9PSi+β10 BOR+β11 LANG+ε (2) correlated with international trade, in which, the impact of LPI
on the international trade of exporting countries is bigger than
Regardless of restricted data sources for developing a unified that for importing countries. Hence, this research hypothesize
index of measuring the implementation for green logistics, some the following:
research employs LPI and environmental indicators such as Kim H1: Logistics performance of exporting and importing countries
and Min (2011) who developed the green logistics index (GLPI) has a positive impact on international trade.
based on the ratio of LPI to EPI. Hardly could ratios reflect the
efficiency of inputs (total logistical efficiency) and outputs (total Companies from different sectors must comply with
environmental performance) (Lu et al., 2019). environmental regulations to remain competitive (Zhang and
Xu, 2016). Under pressure from environmental regulations,
Therefore, the research incorporates the ELPI environmental customers, other stakeholders and internal management,
logistics performance index into “eco-efficiency” (Dahlström exporters must comply with green logistics practices such as:

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Green purchasing, green transportation, green packaging, etc. 4. RESULTS AND DISCUSSTION
achieve ISO14000 certification and reverse logistics, reduce
their environmental impact and promote their economic, 4.1. Results of Estimating and Hypothesis Testing
operational, environmental and social performance. By To analyze panel data, some models such as Pooled OLS model,
practicing green logistics, exporters better comply with the FEM or REM are taken into consideration. This research uses the
environmental regulations of the importing country to enhance Breusch-Pagan LM test to select the relevance between Pool OLS
their competitiveness (building a positive image domestically and REM. The Breusch-Pagan test results show prob> chibar2 <0.05,
and internationally to have more export opportunities, increase consequently, the REM model is more suitable than Pool OLS.
market share, seek new markets) and lead to an increase in
export volume (Lai and Wong 2012; Ueasangkomsate and Then, the Hausman test is run to choose between the FEM and
Suthiwartnarueput 2018). Hence, this research hypothesize the REM, based on the evaluation of the correlation between the error
following: and the independent variable. Hausman test results, Prob>chi2
H2: The green logistics level of the exporting country has a positive is <0.05, FEM model results are better than REM. After the
impact on the export volume. Breusch-Pagan test and Hausman test, the results from the FEM
fixed-effects model are selected.
Many studies have shown the relationship between trade and the
environment. However, empirical literature on the relationship After that, technical inspections detect the model’s defects.
between the environmental regulation of importing countries Heteroskedasticity affects the bias of a linear model. However,
and international trade is relatively scarce (De Santis, 2012). due to a variety of economic factors, time series data can have
Van Beers and Van Den Bergh (1997) based on data of The heteroskedasticity. In addition, autocorrelation occurs if the random
organization for economic cooperation and development errors correlated with each other across time, which does not affect
(OECD), concluding that the stringent environmental regulations the bias and stability of the linear model. However, autocorrelation
of importing countries have a number of effects negative impact is related to the variance of the estimated coefficients; therefore,
on other countries’ exports. Similarly, Wang et al. (2018) based detecting heteroskedasticity and autocorrelation is important to
their study on data of 112 developed and developing countries implement corrections and ensure the statistical significance of
plus Hong Kong, indicate that there is a negative relationship the model.
between the level of green logistics of the importing country and
the export volume of the exporting country. A possible reason The heteroskedasticity was detected when the Wald test is
for this result is that environmental regulations of the importing taken. With Prob>chi2 <0.05, the model has heteroskedasticity.
countries, such as the end of life vehicles (ELV) or restriction of Wooldridge test detects autocorrelation in the model. With Prob>F
hazardous substances (RoHS), form trade barriers to green trade, >0.05, the model does not appear autocorrelation. After the Wald
which raises the technological threshold and results in reduced test and Wooldridge test, the model has heteroskedasticity and is
export volumes for foreign exporters. Hence, this research overcomed by the FGLS method. In essence, FGLS uses equivalent
hypothesize the following: transformations to bring about a new model which the random
H3: The level of green logistics of the importing country has a error in the model has homoscedasticity, then uses the OLS method
negative impact on export volume of the exporting country. to estimate the new model.

3.2. Data Processing In the FGLS estimation results for the Model 1, only the effect of
The study uses green logistics and international trade data for 19 the LPI on the export volume of the exporting country. The effects
APEC countries from 2010 to 2018, excluding Hong Kong and of the remaining variables are studied in Model 2.
Taiwan (ROC), since international trade data of these territories
is not published. Research data is obtained from some reliable In Table 4, the coefficients of two variables lnLPIe and lnLPIi
sources, mainly from the United Nations (UN), the World Bank are both positive, showing that the LPI of the two exporting and
(WB), and Centre d’ Etudes Prospectives et d’ Informations importing countries have a positive impact on international trade
Internationals (CEPII). between these two, the conclusion is significant at 1% level. It is
consistent with the study of Behar and Manner (2008), Marti et
In Table 2, the model’s variables fluctuate considerably when a big al. (2014), Bensassi et al. (2015), Chakraborty and Mukherjee
disparity witnessed between the maximum and minimum values, (2016), Uca et al. (2016), Wang et al. (2018). The LPI of the
notably for export volume and GDP. Apart from LPI, all variables exporting country will impose greater impacts on the export
have standard deviations greater than the mean. volume. However, the difference in the coefficients of two LPI
variables in the model is not significant. H1 is accepted.
In Table 3, regarding the relationship between the independent
variables, all coefficients have absolute values <0.8. The highest In Model 2, the model selection and technical testing are taken
correlation coefficient is observed between lnGDPi and lnPOPi similarly to Model 1. In Table 5, the results from two tests Breusch-
at 0.7607. The variance inflation factor (VIF) of most variables Pagan LM and Hausman reveal that the FEM model is suitable.
is <10 excluding the VIF coefficient of POPe at 13.95. However, The results from two tests Wald and Wooldridge express that the
the mean VIF of the variables is 5.32 <10, which illustrates a low model has heteroskedasticity defect, and the FGLS estimation
multicollinearity in research data. method is used to surmount this defect.

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Table 1: Data sources and expected side of variables In Table 6, the environmental logistics efficiency of an exporting
Variable Expected Source country has a positive effect on that country’s export volume, which
side is significant at the 1% level. Specifically, the coefficient lnELPIe
Export volume is 0.6519, when the ELPI index of the exporting country increases
LnEXP UN Comtrade Database by 1%, the export volume of that country’s goods increases by
Gross domestic product 0.65%, other factors being held constant. This conclusion is relevant
lnGDPe + The World Development
lnGDPi + Indicators (WB) to previous studies (Khan and Qianli, 2017; Wang et al., 2018;
Population Lu et al., 2019). The above conclusion comes from the fact that
lnPOPe + exporting countries have proactively changed to meet the green
lnPOPi + logistics regulations issued by the importing country, thereby helping
Regulatory quality to increase export output in both quantity and quality. H2 is accepted.
RQi +
Political stability
PSi + The coefficient lnELPIi is 0.4821 opposite the expected side
Logistics performance affecting the export volume in Model 2. When the ELPI of the
index importing country increases by 1%, the export volume of goods
lnLPIe + Logistics Performance Index of the exporting country increases by 0.48%, ceteris paribus.
lnLPIi + (WB)
Enviromental logistics
The rationale is strict environmental protection regulations
performance index enacted by developed countries in the early stages. In the short
lnELPIe + Synthesis of the research team term, the lack of ability to meet environmental regulations
lnELPIi + among enterprises in developing country leads to trade volume
Distance downturn. In the long term, if exporters adapted to environmental
lnD − GeoDist database (Mayer and
Common border
regulations and comprehensively apply green logistics standards,
Zignago, 2011) (CEPII)
BOR + they would significantly benefit from improved environmental
Common language quality, enhance international competitiveness, and create new
LANG + comparative advantage which can offset short-term losses in the
Source: Synthesis of the authors. e stands for exporting country; i stands for importing end (Porter and Van der Linde, 1995). H3 is rejected.
country,

The size of an exporting and importing country’s economy both

Table 2: Descriptive data statistics positively affects the volume of trade between the two countries,
Variable Obs Mean SD Min Max which is significant at 1% is relevant to the conclusion in the gravity
EXP 2.699 1.51e+10 4.37e+10 1 4.80e+11 model. The GDP coefficient of the importing country is higher than
GDPe 2.699 2.50e+12 1.14e+10 1.14e+10 2.06e+13 that of the exporting country, which means that the quantity of
GDPi 2.699 2.39e+12 4.43e+12 1.14e+10 2.06e+13 demand has more impact on the trade flow between the two countries.
POPe 2.699 1.60e+08 3.11e+08 414.914 1.40e+09
POPi 2.699 1.54e+08 3.05e+08 414.914 1.40e+09
LPIe 2.699 3.39 0.44 2.57 4.14 In geographical terms, the negative coefficient of distance variable
LPIi 2.699 3.34 0.47 2.17 4.14 suggests that the distance between two countries poses a negative
ELPIe 2.699 44,954.92 39,110.34 11,044.67 217,330.40 effect on trade. This conclusion is significant at 1%. Two countries
ELPIi 2.699 44,264.64 38,339.77 11,044.67 217,330.40 with a common border positively affect the volume of trade
RQi 2.699 0.76 0.86 −0.67 2.26
PSi 2.699 0.12 0.86 −1.65 1.61567 between them, which is significant at 1%. Demographic factors
D 2.699 9190.27 5532.75 315.54 19711.86 such as population and common language have a positive effect
Bor 2.699 0.06 0.24 0 1 on international trade, which is significant at the 1% level. This
Lang 2.699 0.16 0.37 0 1 conclusion is relevant to the study of Puertas et al. (2014); Wang
Source: Authors’ calculation et al. (2018).

Table 3: Correlation matrix

lnEXP lnGDPe lnGDPi lnPOPe lnPOPi lnD lnELPIe lnELPIi RQi PSi Bor Lang
lnEXP 1.0000
lnGDPe 0.4538 1.0000
lnGDPi 0.5380 −0.0492 1.0000
lnPOPe 0.3615 0.7530 −0.0343 1.0000
lnPOPi 0.4296 −0.0403 0.7607 −0.0513 1.0000
lnD −0.3862 0.0580 0.0517 −0.0160 −0.0182 1.0000
lnELPIe 0.2418 0.2220 −0.0070 −0.2630 0.0179 −0.0690 1.0000
lnELPIi 0.2207 −0.0063 0.2276 0.0199 −0.2401 −0.0611 −0.0469 1.0000
RQi 0.0373 0.0338 −0.0052 −0.5742 0.0294 0.1125 0.6911 −0.0414 1.0000
PSi 0.0502 −0.0002 0.0431 0.0275 −0.5119 0.0317 −0.0384 0.6500 −0.0448 1.0000
Bor 0.2198 0.0270 0.0236 0.0599 0.0484 −0.4334 −0.0637 −0.0555 −0.0569 −0.0349 1.0000
Lang 0.0771 0.0057 −0.0511 −0.1404 −0.1527 −0.1050 0.2023 0.1727 0.2728 0.1479 0.1585 1.0000
Source: Authors’ calculation

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Table 4: Technical inspections and model selection – Table 7: Classified countries by GNI/capita
Model 1 Group GNI/capita
Countries
Variable Pool OLS FEM REM FGLS High‑income ≥$12,055
Australia, Brunei Darussalam,
lnGDPe 0.2104*** 0.7434*** 0.6190*** 0.4000*** countries Canada, Chile, Japan, New
lnGDPi 0.4474*** 0.4732*** 0.6138*** 0.4831*** Zealand, Singapore, South Korea,
lnPOPe 0.6150*** −1.1263** 0.2927*** 0.3981*** United States
lnPOPi 0.3707*** −0.0990 0.2913*** 0.3267*** Middle‑income $996–$12,055 China, Indonesia, Malaysia,
lnD −1.1548*** −1.4073*** −1.1887*** countries Mexico, Papua New Guinea, Peru,
lnLPIe 5.8238*** 0.2574 0.8049*** 4.7400*** Philippines, Russia, Thailand,
lnLPIi 5.0417*** 0.3569* 0.9936*** 4.6905*** Vietnam
RQi 0.2513*** −0.1013 0.0505 0.0571*** Source: Authors’ computation based on World Bank
PSi −0.0517 −0.0500 −0.0752 −0.0557***
Bor 0.3423*** −0.1003 0.3038***
Lang 0.2515*** 0.7848*** 0.2777*** a country’s export. This conclusion is similar to Anderson and
Const −22.7964*** 9.1925 −12.7161*** −16.5628*** Marcouiller (2002) who argued that a strong institution with a
R‑square 0.7930 0.0353 0.7253 complete legal system for commercial contracts enforcement, fair
Obs 2.699 2.699 2.699 2.699 laws and economic policies adopted by the government makes a
P‑value great contribution to commercial development.
Breusch‑Pagan LM test 0.000
Hausman test 0.000
Political stability has a positive effect on export volume, which
Wald test 0.000
Wooldridge 0.1964
is significant at 1%. Govindan et al. (2014), said that political
instability was an obstacle for exporting countries due to a lack
Source: Authors’ calculation. *P<0.1; **P<0.05; ***P<0.01
of support from the host country. This result is contrary to the
conclusion of Wang et al. (2018) who found a negative relationship
Table 5: Technical inspections and model selection – between the level of political stability of the importing country
Model 2 and the probability of exporting.
Variable Pool OLS FEM REM FGLS
lnGDPe 0.1179** 0.7720*** 0.4785*** 0.2592*** 4.2. Green Logistics Impact on International Trade
lnGDPi 0.6206*** 0.3696*** 0.5138*** 0.6088***
lnPOPe 0.8903*** –1.1976** 0.4154*** 0.6955*** between Group Countries
lnPOPi 0.3796*** 0.1198 0.4022*** 0.3563*** To further investigate the relationship between green logistics
lnD –1.2801*** –1.3516*** ‑1.2912*** and trade flows of economies at disparate economic development
lnELPIe 0.6544*** –0.0325 0.2921*** 0.6519*** levels, the research classified the countries in the sample into two
lnELPIi 0.4882*** 0.1592 0.2214** 0.4821*** groups (Table 7): 9 high-income countries and 10 middle-income
RQi 0.8747*** –0.0850 0.0483 0.5866***
ones, based on the threshold GNI/capita (value of income per
PSi 0.2890*** –0.0410 –0.0400 0.2599***
Bor 0.2749** –0.0060 0.1680*** capita in current USD exchange rate) updated by the World Bank
Lang 0.1442* 0.8296*** 0.1719*** on July 1, 2018.
Const –22.7964*** 8.0197 –14.0312*** –21.9962***
R‑square 0.7603 0.0350 0.7038 In Table 8, the research estimated equation (2) with four samples:
Obs 2.699 2.699 2.699 2.699 MIC-MIC (Sample 1), MIC-HIC (Sample 2), HIC-MIC (Sample
P‑value 3), HIC-HIC (Sample 4) to find out whether there is a difference
Breusch‑Pagan LM test 0.000
among the variables in the model.
Hausman test 0.000
Wald test 0.000
Wooldridge 0.1927 For exporting countries, the regression coefficient of ELPI in four
Source: Authors’ calculation. *P<0.1; **P<0.05; ***P<0.01
samples is positive and statistically significant, green logistics in
exporting country is positively correlated with export. The higher
the green logistics efficiency of the exporting country, the greater
Table 6: Result of hypothesis testing
the export probability and export volume. It is consistent with the
Hypothesis Result
estimated results for the entire sample of 19 countries. In particular,
H1 Logistics performance of exporting and importing Accepted
countries has a positive impact on international trade in sample 4, the coefficient lnELPIe is 0.7452, recording a rather
H2 The green logistics level of the exporting country Accepted large influence of green logistics efficiency on export output
has a positive impact on the export volume between the two high-income countries.
H3 The level of green logistics of the importing country Rejected
has a negative impact on export volume of the For importing countries, the regression coefficients of ELPI in
exporting country
four samples are different, only statistically significant in sample
Source: Authors’ calculation 1 and sample 4. In sample 4, this coefficient has a positive value
(consistent with the estimated results for the entire sample
The regulatory quality of the importing country has a positive effect of 19 countries). However, in sample 1, this coefficient has a
on the export volume of the exporting country, which is significant negative value meaning that the green logistics efficiency of the
at the 1% level. Consequently, a change in a government’s ability importing country has a negative impact on the export output of
to formulate and implement policy has a significant impact on the exporting country, between the two middle-income countries.

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 Le, et al.: Impact of Green Logistics on International Trade: An Empirical Study in Asia – Pacific Economic Cooperation

Table 8: FGLS estimation results for four samples

Variable MIC‑MIC (Sample 1) MIC‑HIC (Sample 2) HIC‑MIC (Sample 3) HIC‑HIC (Sample 4)
lnELPIe 0.3006*** (4.12) 0.3479*** (4.36) 0.4215*** (6.08) 0.7452*** (17.49)
lnELPIi –0.2618*** (–4.99) –0.0579 (–1.01) 0.0607 (0.76) 0.8526*** (23.47)
Source: Authors’ calculation. *P<0,1, **P<0,05, ***P<0,01

The reason may originate from increasingly strict requirements by encouraging and supporting enterprises to implement green
for environmental regulations set by importing countries, so logistics, increasing the use of green renewable fuels, establishing
middle-income countries have to spend much more money on a market for green logistics and industry. In the medium term, it
waste treatment, construction investment costs and infrastructure is necessary to issue specific standards and regulations on carbon
improvement to comply with that. In general, the initial adoption emissions; create legal requirements for green logistics; create a
of green practices requires heavy investment leading to huge fixed domestic market for green fuel resources. In the long term, the
costs in the end-to-end supply chain system, and has a negative consideration of imposing high import tax, environmental tax
impact on the firm’s financial performance in the short term (Khan or penalties on businesses utilizing harmful materials should be
et al., 2019). For middle-income countries, high compliance costs taken into.
are challenging for exporters to catch up; therefore, green logistics
becomes a trade barrier between two countries in the group of Enterprises should use means of transport with lower emissions
middle-income countries. such as clean energy, water transport or use green packaging
that is recyclable, biodegradable, and creates green supply chain
to maintain and promote domestic and global competitiveness.
5. CONCLUSIONS AND POLICY
Enterprises should update information technology to manage
IMPLICATIONS system data effectively, improve logistics quality, and save time
in the transportation and delivery duration. The community of
The study evaluates the impact of green logistics on international traditional logistics enterprises need to convert to the new version
trade through the augmented gravity model, the FGLS technique, of green logistics. Import-export enterprises ought to build a
and the ELPI index. The study guides countries with different reverse logistics system to satisfy consumers’ demand and promote
levels of development to regulate green logistics and promotes sustainable development, improve competitiveness and scale up
enterprises to implement the green logistics process. import and export turnover.

The estimated model results show that: Logistics efficiency of

exporting and importing countries is positively correlated with
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