The research tackles a long-standing blind spot in climate economics. When a country exports goods, the emissions generated in producing them are counted in the exporting nation’s territorial inventory, even though the goods are consumed elsewhere. This mismatch, known as the problem of embodied or trade-embedded emissions, has been studied extensively since Davis and Caldeira’s landmark consumption-based accounting work, but most analyses treat exports as a single undifferentiated flow. Ünal and Erkök argue that this flattening hides the very information policymakers need. An export of finished consumer goods and an export of intermediate components that feed a partner’s own industrial production have very different implications for how carbon pricing, border adjustments, or supply chain regulations will shift emissions between countries.

To unpack these differences, the authors deploy an environmentally extended input-output framework built on the Eora Global Supply Chain Database, combined with a technique called the Multi-Stage Hypothetical Extraction Method. Hypothetical extraction is a thought experiment rendered in matrix algebra: the analyst mathematically removes a sector, or a demand channel, from the economy’s input-output structure and measures how much output and, in this case, how much carbon dioxide the rest of the system loses as a result. The difference between the original economy and the extracted one quantifies the sector’s total systemic importance, capturing both its direct emissions and the emissions embedded in all the upstream linkages that depend on it. The multi-stage refinement goes further by decomposing exports into intermediate goods and final goods, and by splitting final demand into household consumption, government expenditure, and investment channels, allowing emissions to be traced along distinct domestic production stages for each destination market.

The study focuses on six major trading partners of Türkiye: France, Germany, Iraq, Italy, the United Kingdom, and the United States. This selection spans the European Union markets that dominate Turkish trade, the transatlantic relationship, and a neighboring energy economy, providing a diverse test bed for the method. For each partner, the researchers calculated the carbon dioxide emissions embodied in Turkish exports and, crucially, a set of efficiency measures that relate those emissions to the economic value delivered. It is the efficiency dimension that produced the study’s most alarming headline result: a systemic deterioration in carbon dioxide efficiency across most destinations, meaning that progressively more emissions are being generated per unit of export value delivered to these markets.

The structural decomposition reveals that intermediate goods typically dominate the emissions profile of Turkish exports. This matters because intermediate goods occupy a particularly awkward position in climate policy. They cross borders as inputs to further production, so their embodied carbon will only be fully accounted for when the final product is eventually sold, often in a third country. Under mechanisms such as the European Union’s Carbon Border Adjustment Mechanism, which is designed to prevent carbon leakage by pricing the embedded emissions of imports, the treatment of intermediate goods remains one of the most contested design questions. The finding that Türkiye’s export emissions concentrate in these upstream flows suggests that the country’s industrial base is deeply integrated into European and global value chains in ways that make it structurally exposed to any tightening of carbon accounting at the border.

The United Kingdom emerges as a distinctive case. Unlike the other partners, where either intermediate or final goods tend to dominate, the UK’s import profile from Türkiye shows a broad reliance on both categories simultaneously. This dual dependence means that British demand pulls carbon out of the Turkish economy through two separate channels at once, amplifying the total systemic liability and complicating any single-lever policy response. As the UK develops its own post-Brexit carbon border policies, the study’s results imply that Turkish exporters will face pressure from both ends of their product mix rather than from a single vulnerable segment.

Perhaps the most striking results concern the role of government demand, which behaves in sharply different ways depending on the partner. In France and Italy, state-procured government expenditures drive intense emissions liabilities, channeled primarily through Türkiye’s petroleum and chemical sectors. In other words, when the French or Italian state buys goods with Turkish content, the production cascade that follows leans heavily on some of the most carbon-intensive links in the Turkish industrial chain. By contrast, in Iraq and the United States, government expenditure acts less as a direct trigger and more as a deep systemic dependency, anchored in the utility and heavy manufacturing sectors. These partner-specific patterns demonstrate that the same category of final demand can produce qualitatively different carbon consequences depending on the industrial structure it activates, a nuance that aggregate trade-emissions statistics completely obscure.

Underlying all of these patterns is a remarkably concentrated industrial structure. Four sector groups account for the dominant shares of the efficiency effects the authors measure: textiles, transport equipment, petroleum and chemical products, and electricity and gas provisions. This concentration is both a vulnerability and an opportunity. It is a vulnerability because it means Türkiye’s export carbon footprint is not broadly distributed across the economy but is instead pinned to a handful of energy-intensive nodes, several of which are precisely the sectors most likely to be targeted by carbon border measures and by competition from lower-carbon producers. It is an opportunity because targeted interventions at a small number of chokepoints, such as decarbonizing the electricity and gas supply that feeds industrial production, or modernizing petroleum and chemical processing, could deliver disproportionate improvements in the carbon efficiency of the entire export apparatus.

The authors draw a clear policy conclusion from this structure: mitigation efforts must be targeted and partner-specific rather than uniform. Because the emissions liabilities attached to French government procurement arise through different sectors than those attached to American systemic dependencies, a single national decarbonization strategy will not address all exposures equally. Instead, the findings argue for industrial policies and technological investments calibrated to the specific production stages and demand channels that generate the largest efficiency losses for each destination. The open availability of the study’s processed datasets and analysis code in a public GitHub repository lowers the barrier for other researchers to extend the multi-stage extraction approach to other economies, and the method itself, which links classical linkage analysis in the tradition of Hirschman and Rasmussen to modern environmental accounting, offers a template for dissecting how carbon flows through the layered stages of globalized production.

As carbon border regulations spread and trading partners begin pricing the emissions embedded in imports, studies of this kind are likely to become essential reading for policymakers in emerging industrial economies. The Turkish case shows that the question is no longer simply how much carbon a country exports, but through which sectors, along which production stages, and in response to whose demand. Answering that question with the granularity that the multi-stage hypothetical extraction method provides may determine which economies adapt smoothly to a carbon-constrained trading system and which find their industrial linkages transformed into liabilities overnight.

Subject of Research: Export-embodied CO2 emissions and carbon leakage in Turkiye's trade analyzed via multi-stage hypothetical extraction

Article Title: Sectoral linkages and carbon leakage: A multi-stage hypothetical extraction analysis of export-embodied emissions

Article References: Ünal, E., & Erkök, B. (2026). Sectoral linkages and carbon leakage: A multi-stage hypothetical extraction analysis of export-embodied emissions. Journal of Industrial Ecology, 30(4), 2189-2207. https://doi.org/10.1007/s44498-026-00149-2

Image Credits: AI Generated

DOI: 10.1007/s44498-026-00149-2

Keywords: carbon leakage, embodied emissions, input-output analysis, hypothetical extraction method, Turkiye, international trade, CO2 efficiency, intermediate goods, carbon border adjustment, industrial policy, global value chains, Eora database

Minnich builds his argument on an analogy drawn from economics rather than strategy alone. He applies theories of oligopolistic competition, the behavior of markets dominated by a small number of large firms, to the international system. Just as a handful of dominant companies in a concentrated market must anticipate each other’s moves, great powers in a multipolar world are locked in strategic interaction where each actor’s choices shape the competitive landscape. The analogy is imperfect, as the author concedes, but it illuminates a crucial structural point: whether firms or states compete or collude is not determined by structure alone. Oligopolists can slash prices to win market share, or they can quietly form cartels. Great powers, likewise, can compete for spheres of influence or reach accommodations that divide the world between them.

The starting point of the analysis is the behavior of a monopolist. When a single firm dominates a market, its overriding priority is to preserve that position by preventing rivals from emerging. Monopolists therefore have weak incentives to trade valuable assets, such as proprietary technology, for short-term sales, and strong incentives to restrict technology flows to potential future competitors. Minnich points to real-world examples such as the Dutch firm ASML, which monopolizes the production of cutting-edge lithography systems, and CFM International, which dominates the narrowbody aircraft jet engine market. Both sell heavily to China, yet neither has transferred meaningful technology to Chinese partners, even where doing so would have been legal. Control over supply gives such firms the leverage to dictate terms.

He then argues that after the Cold War, the United States occupied a broadly analogous position over global technology flows, since almost all high-technology companies were headquartered in the United States and its allies, and American firms controlled much of the core intellectual property behind high-tech goods produced elsewhere. The post-Cold War shift to an effective Western monopoly over technology coincided with the creation and expansion of a far more robust international intellectual property regime, embodied in the World Trade Organization’s agreements on Trade-Related Intellectual Property Rights and Trade-Related Investment Measures. Whatever their motives and merits, Minnich suggests, these agreements plausibly slowed technology diffusion to less-developed countries by narrowing their development policy space. It is striking, he notes, that since 1990 lower-income countries’ share of global manufacturing value-add has generally stagnated, with the notable exception of China, which pursued precisely the technology transfer and industrial policies the Washington Consensus discouraged.

The situation changes when a challenger enters the market. In an oligopoly, incumbents must balance their long-term interest in preventing future competitors against the short-term need to fight current rivals for market share. The more intense the competition, the more willing incumbents become to trade long-term advantages for immediate access to new markets or influence over client states. At the same time, competition on the supply side boosts the bargaining power of prospective host countries, which can play rival suitors against each other to extract better terms, including pledges of technology transfer. History offers vivid illustrations. During the Cold War, the Soviet Union between 1953 and 1960 set up more than 200 industrial projects in China, transferred thousands of industrial designs, sent as many as 10,000 experts, and educated more than 50,000 Chinese engineers, transfers that research shows durably improved Chinese firms’ capabilities in steel and other heavy industries. American allies in East Asia benefited from direct military technology transfers and support for licensing commercial technologies.

There is evidence that this dynamic is already re-emerging. Aspects of China’s Belt and Road Initiative, including the Digital Silk Road, have been examined for the technology spillovers they enable in host countries. Drawing on recent data, Minnich highlights a sharp increase in Chinese greenfield investment in clean energy technology manufacturing, from electric vehicles and batteries to solar, wind, storage, and green hydrogen, with the vast majority flowing to countries outside North America, Europe, and Northeast Asia. Some of this investment has been accompanied by explicit calls for or pledges of technology transfer. Gulf governments, for example, have sought to leverage U.S.-China competition to secure transfers in battery technology and artificial intelligence data center development. Two factors could accelerate the trend: the decline of the WTO as an enforcement mechanism, eroding norms against state intervention, and the U.S.-China trade war, whose first phase from 2018 to 2025 helped fuel rising Chinese manufacturing investment across the Global South.

Yet the analysis carries a warning. Just as firms in concentrated markets may collude rather than compete, great powers can coordinate, tacitly or overtly, to carve up the geopolitical market at others’ expense. President Trump has repeatedly stated his desire for a deal with China and signaled openness to Chinese investment in American manufacturing, prompting prominent international relations theorists to speculate about a grand bargain between the two countries. Given the increasingly personalistic nature of policymaking under Trump, exemplified by his abrupt about-face on sales of certain AI chips to China, such possibilities cannot be dismissed. In theory, an agreement that durably lowered bilateral tensions could reduce both sides’ incentives to trade technology for political support in the periphery, effectively transforming oligopoly back into monopoly and stripping third countries of their leverage.

The consequences of such collusion would not be catastrophic relative to the post-Cold War status quo, but Minnich emphasizes that this status quo was dire for much of the developing world. According to United Nations figures cited in the study, between 1990 and 2022 lower-middle-income countries’ share of global manufacturing value-add rose only modestly from 5 to around 7 percent, while middle-income countries excluding China fell from almost 9 to under 7 percent, and low-income countries hovered near zero. China’s share, meanwhile, surged from 3 to 32 percent. Should the pattern of premature deindustrialization continue for another thirty years, the author warns, it would amount to a catastrophe for global development.

Fortunately for the Global South, a durable grand bargain appears unlikely, at least for now. Recent scholarship argues that lasting U.S.-China cooperation is most feasible when both countries face a common adversary and are led by pro-globalization domestic coalitions, neither of which holds today. Minnich adds a structural hypothesis: collusion is more sustainable when power is evenly balanced and stable, resembling the duopoly Boeing and Airbus enjoyed in commercial aircraft from roughly 2000 to 2018, and harder to sustain when power differentials are uneven and changing rapidly. The current U.S.-China balance of power fits the latter scenario, suggesting any attempted bargain would be unstable in the short to medium term, though a more even balance over time could eventually favor accommodation.

The study closes with a third, ironic possibility the author calls inadvertent collusion. The tariffs the second Trump administration imposes on the world outside China, combined with the uncertainty they generate, may lead firms to keep manufacturing in China rather than relocate to the United States or elsewhere, reinforcing Chinese manufacturing dominance and undercutting incentives to invest in and transfer technology to newly industrializing economies, as much as any formal deal might. Reports already suggest Chinese manufacturers are rethinking their Southeast Asian pivots. As with active collusion, this would likely be an unstable equilibrium, but inertia and path dependency are powerful forces, and the effects of even short-lived policies often outlast the policies themselves. For Minnich, the bottom line is bittersweet: great power rivalry will make the world more dangerous, yet insofar as it improves low-income countries’ access to and ability to bargain for technology, it would be a small silver lining to an otherwise fraught situation.

Subject of Research: The impact of U.S.-China great power competition and Trump-era geopolitics on technology transfer to the Global South

Article Title: Trump, U.S.-China competition, and the future of technology transfer

Article References: Minnich, J. (2025). Trump, U.S.-China competition, and the future of technology transfer. Global Public Policy and Governance, 5(4), 411-421. https://doi.org/10.1007/s43508-025-00125-9

Image Credits: AI Generated

DOI: 10.1007/s43508-025-00125-9

Keywords: technology transfer, U.S.-China relations, Global South, great power competition, oligopoly theory, industrial policy, Belt and Road Initiative, intellectual property, multipolarity, Trump administration, industrialization, foreign direct investment

The research team, led by Brahampal Yadav of the Central University of Haryana, examined a 127-kilometre stretch of the corridor that links the booming urban centres of Gurugram, Manesar, Dharuhera, Bawal, Bhiwadi and Neemrana. Using industrial registers maintained by the District Industrial Centres of Gurugram, Rewari and Alwar, the researchers built a spatial database of every registered large-scale and medium-scale unit established between the pre-reform era and 2025. They then overlaid these locations onto a geographic information system and measured how industrial density changed with distance from the highway itself.

The headline finding is strikingly simple: factories cluster where the road is. More than half of all large-scale industries along the corridor sit within the first two kilometres of the NH-48 centre line, and density falls off exponentially beyond that point. Fitting the data to an exponential decay model, the team found that large enterprises show a decay coefficient of 1.57, meaning their presence drops off extremely sharply with each additional kilometre from the highway. The model explained 98.8 percent of the variance in observed large-scale industrial density, an unusually strong fit for spatial data. Medium-scale industries behave differently, with a gentler decay coefficient of 0.68 and a distribution that extends meaningfully out to about seven kilometres from the road.

That two-tiered spatial structure is not an accident, the authors argue, but the visible outcome of competing economic forces. Large anchor firms, particularly in automotive manufacturing, depend so heavily on freight logistics that they pay a premium for highway frontage. Medium and ancillary suppliers, meanwhile, are squeezed outward by rising land rents near the road but pulled back by the need to remain within supply-chain reach of their larger customers. The result is a secondary industrial ring in the three-to-seven-kilometre zone, where cheaper land and secondary road connections allow smaller firms to balance cost against accessibility. The researchers note that similar dual-force dynamics have been documented in Shanghai, in Canada, and along Mexico’s northern border maquiladora belt, suggesting the pattern is a general feature of corridor-based industrialisation rather than an Indian peculiarity.

The historical dimension of the study reveals how policy shaped this geography. Before India’s 1991 liberalisation, industrial activity along the corridor was sparse and unplanned. Gurugram hosted just twelve major industries, Maruti Suzuki’s 1973 arrival had seeded only scattered automotive suppliers, and towns like Dharuhera and Bawal remained largely agrarian. In Rajasthan, Bhiwadi was only beginning to industrialise under early initiatives of the Rajasthan Industrial Investment and Development Corporation, while Neemrana was still essentially a farming settlement. Growth in this era depended on proximity to Delhi rather than coordinated state policy.

Liberalisation changed everything. After the reforms of 1991 unleashed private and foreign investment, Gurugram’s large industries more than doubled, rising from twelve to twenty-six between 1991 and 2001 following the release of Haryana’s industrial policy. Haryana recorded industrial growth of 6.71 percent per annum in the 1990s, above the national average of 6.03 percent. The following decade brought consolidation: the announcement of the Delhi-Mumbai Industrial Corridor and a wave of Special Economic Zones drove an unprecedented 46 new industries into Bawal and Dharuhera alone, while Neemrana’s Japanese Industrial Zone, established in 2006, drew investors from Japan and South Korea. Between 2011 and 2025, the corridor matured, with large-scale growth stabilising in established hubs while medium and ancillary industries diffused into peripheral zones.

The exponential growth modelling also revealed a clear southward diffusion of industrial momentum. Rewari recorded the highest annual industrial growth rate at 0.0846, followed by Neemrana at 0.0828 and Bhiwadi at 0.0732, while Gurugram’s lower rate of 0.0649 reflects its transition into a mature economy dominated by information technology and services. This redistribution, the authors suggest, represents a trickle-down effect in which peripheral regions absorb industrial spillovers from the original core nodes. The emergence of seven new census towns by 2011, including Manesar, Garhi Harsaru and Bhondsi in Gurugram district and several in Rewari, further illustrates how industrial employment has pulled populations and urban functions into previously rural areas.

Urbanisation and industrialisation proved to be mutually reinforcing. Between 1991 and 2001, Gurugram’s population grew by 67.9 percent and Rewari’s by 39.5 percent, while Dharuhera surged by 74.2 percent as it developed into a supporting node for both industry and residence. The following decade saw even larger gains in Gurugram and Bhiwadi, driven by urban spillover from industrial employment. As the pool of skilled labour expanded, it in turn attracted new investment, creating the cumulative causation that theorists from Myrdal to Krugman have long described. The study’s framework draws on Weber’s least-cost location theory, agglomeration economics, growth pole theory and New Economic Geography, but the authors conclude that classical models must be supplemented by an understanding of state-directed estate development through agencies like HSIIDC and RIICO to explain industrial space in a South Asian context.

The policy implications are significant. The self-reinforcing nature of agglomeration means investment flows to places where investment already exists, deepening the divide between the highway belt and its hinterland, and between the corridor’s mature northern nodes and its less developed southern ones. The researchers argue that the long-term sustainability of the Delhi-Mumbai Industrial Corridor framework depends on deliberate multi-nodal growth planning, with infrastructure investment and industrial incentives directed beyond the highway’s immediate buffer zones. Without such intervention, the exponential decay curves documented here will continue to describe not just factory locations but the distribution of economic opportunity itself.

The study also acknowledges its limits. The analysis relies on secondary administrative records and does not capture firm-level productivity, environmental performance or informal industrial activity, and the buffer approach cannot fully explain every industrial location decision. The specific distance thresholds identified for NH-48 should be treated as context-specific until tested on other corridors in India and across the developing world. Still, the decay coefficients presented here offer some of the few quantitative measures of highway-proximity effects along an Indian industrial corridor, and they make a compelling case that the geography of manufacturing in the National Capital Region is as much an institutional artefact of policy choices as it is a market outcome. For planners hoping to spread the benefits of corridor-led growth more equitably, the message is clear: the road alone will not carry industry to the periphery.

Subject of Research: Spatial and temporal evolution of industrial clustering along the NH-48 highway corridor in India's National Capital Region

Article Title: How highway proximity and policy reforms shape industrial space across urban areas along India’s NH-48 corridor in the National Capital Region

Article References: Yadav, B., Kanav, A., & Kumar, J. (2026). How highway proximity and policy reforms shape industrial space across urban areas along India’s NH-48 corridor in the National Capital Region. Discover Cities, 3(1), Article 171. https://doi.org/10.1007/s44327-026-00357-2

Image Credits: AI Generated

DOI: 10.1007/s44327-026-00357-2

Keywords: NH-48 corridor, National Capital Region, industrial clustering, distance decay, economic liberalisation, Delhi-Mumbai Industrial Corridor, agglomeration economies, urbanisation, industrial policy, Gurugram, spatial analysis, corridor development