Lecture 10: International Trade and Climate Policy

Brief

Professor Joseph Aldy’s lecture (Lecture 10) explains how carbon is embedded in international trade, identifies risks from policy differences—carbon leakage, competitiveness impacts, and trade tensions—and evaluates policy tools (border carbon adjustments, harmonized standards, tariffs/export rebates, and cooperative agreements) to manage those risks, with a focus on U.S.–China dynamics.

Why it matters

Lecture 10 (published 2026-06-24) — Professor Joseph Aldy demonstrates that carbon emissions are embedded across international supply chains and that divergent national climate policies create risks such as carbon leakage, competitiveness pressures, and trade disputes, especially between the U.S. and China.

Key details

Aldy surveys policy responses to manage those risks — border carbon adjustments, harmonized standards, tariffs or export rebates, and international cooperative agreements — as part of Harvard Kennedy School's 'The Energy‑Climate Challenge' course supported by Energy Foundation China.

In "The Energy-Climate Challenge," five Harvard Kennedy School professors explain the fundamentals of climate change, the role of our energy systems in causing it, and the policy and technology options for addressing it. This course focuses on the United States and China, the world's two largest carbon-emitting companies.

In Lecture 10 of the series, Professor Joseph Aldy, Professor of the Practice of Public Policy, explains how carbon emissions are embedded in international trade, the risks stemming from differences in the climate policies of countries, and how to design policies to manage those risks.

Chinese-Language Version (中文版): https://youtu.be/HEFJEhQlY3I

Video Production: Alex Griswold.

The Belfer Center gratefully acknowledges the support of Energy Foundation China for this course.

Channel: Belfer Center
Published: 2026-06-24
Video URL: https://www.youtube.com/watch?v=y_tEvihi3nc