Trade Liberalisation and Effects on Pollutive Emissions and Waste A General Equilibrium Assessment for Norway

Taran Fæhn and Erling Holmøy ()
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Erling Holmøy: Statistics Norway, https://www.ssb.no/en/forskning/ansatte

Discussion Papers from Statistics Norway, Research Department

Abstract: This paper assesses effects of the last decade's multinational liberalisation of foreign trade, in terms of economic gains and in terms of pollution. By means of a disaggregated intertemporal CGE model for Norway two scenarios with and without the trade reforms are compared. Despite a slight decrease in GDP, emissions of several pollutants rise significantly. This is partly attributable to a modest increase in aggregate welfare, as polluting consumption rise significantly along with reduced labour effort. Further, the trade reforms, in combination with existing policy concessions, result in a long-run structural change in favour of heavy-polluting export industries. As these are large consumers of electricity, prices of clean hydropower rise and cause an economy-wide substitution towards more pollutive energy sources.

Keywords: Trade Reforms; Welfare; Environment; Intertemporal CGE Model (search for similar items in EconPapers)
JEL-codes: D58 D60 F13 Q25 (search for similar items in EconPapers)
Date: 2001-04
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Persistent link: https://EconPapers.repec.org/RePEc:ssb:dispap:298

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