Economic integration and environmental policy coordination

Odd Rune Straume

No 13/03, Working Papers in Economics from University of Bergen, Department of Economics

Abstract: We analyse the effect of international economic integration on environmental policy incentives when product markets are characterised by imperfect competition and national policy makers act strategically. If traditional trade policy instruments are not available, environmental policies will typically be determined by the interaction of conflicting policy incentives. We find that economic integration — interpreted as a reduction of non-tariff trade costs — will reduce policy distortions in the non-cooperative policy game if the marginal social cost of pollution is increasing at a sufficiently low rate. In this case, it follows that increased integration reduces the need for transnational policy coordination, from an environmentalist perspective.

Keywords: Economic integration; Strategic environmental policy; Policy coordination. (search for similar items in EconPapers)
JEL-codes: F12 F15 F18 H23 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2003-11-08
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:bergec:2003_013

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