Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes

Mark R. Metcalfe and John Beghin ()

ISU General Staff Papers from Iowa State University, Department of Economics

Abstract: We incorporate endogenous (price-responsive) consumption pollution into a dual trade model to assess welfare effects of coordinated trade and environmental piecemeal reform in a small, open and distorted economy. Pollution is generated by production and consumption. Producers control the level of pollution and face incentives to abate both types of pollution. We identify sufficient conditions for welfare-improving reforms of trade and environmental policies. An additional domestic environmental policy instrument must be imposed on exportables because of their supply response to foreign environmental taxes.

Date: 2015-01-01
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Related works:
Journal Article: Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes (2015)
Working Paper: Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes (1999)
Working Paper: Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:isu:genstf:201501010800001054

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