A Dynamic Model of Effects of Effects of Trade and Environmental Policies on Firms' Offshoring and Clean Technology Adoption Decisions

Xianwei Meng and Xuan Wei

No 236064, 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts from Agricultural and Applied Economics Association

Abstract: This paper develops a dynamic general equilibrium model to analyze the effects of changes in trade and environmental policies on firms' production location choices and clean technology adoptions to reduce emission. During this process, the equilibrium worker's wages and environmental quality of related countries are determined. In addition, this model is applied to the trade and production relocation issues between the United States and China over 1999-2013 to quantify the pollution haven effects and the total production offshoring directly and indirectly from the U.S. to China. Further, the long-run predictions on offshoring and emission levels in both countries and counterfactual policy analysis are discussed in this paper.

Keywords: Environmental Economics and Policy; Industrial Organization; International Relations/Trade; Labor and Human Capital; Productivity Analysis; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 59
Date: 2016
New Economics Papers: this item is included in nep-cna, nep-env and nep-int
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea16:236064

DOI: 10.22004/ag.econ.236064

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