Transboundary Renewable Resource and International Trade

Yasuhiro Takarada

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: We develop a two-country, two-good model with a transboundary renewable resource. A transboundary renewable resource is an open-access resource that is shared by two countries. We characterize the autarkic steady state, then examine the patterns of trade and the post-trading steady-state utility levels. Although the resource stock is reduced by trade, both countries may still benefit from trade when they are specialized in production. We also show that the steady-state utility of a resource good importing country may be reduced by trade, even if it specializes in production of a non-resource good which we refer to as manufactures.

Pages: 30 pages
Date: 2009-08
New Economics Papers: this item is included in nep-env
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:09041

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