International trade and the environment: theoretical and policy linkages

J. Peter Neary

No 200018, Working Papers from School of Economics, University College Dublin

Abstract: I review and extend three approaches to trade and environmental policies: competitive general equilibrium, oligopoly and monopolistic competition. The first two have surprisingly similar implications; deviation deviations from first best rules are justified only by constraints on policy choice (which motivates what I call a "single dividend" approach to environmental policy), and taxes and emissions standards differ in ways which reflect the Le Chatelier principle. I also show how environmental taxes may lead to a catastrophic relocation of industry in the presence of agglomeration effects, although not necessarily if there is a continuum of industries which differ in pollution intensity. An earlier version was presented as an invited plenary lecture to the European Association for Environmental and Resource Economics Conference, Oslo, 1999.

Keywords: Environmental policy; International trade policy; Location and economic geography; Pollution abatement; Strategic trade policy; Environmental policy; Commercial policy; Industrial location; Environmental impact charges (search for similar items in EconPapers)
JEL-codes: F12 L13 O13 (search for similar items in EconPapers)
Date: 2005-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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http://hdl.handle.net/10197/1261 First version, 2005 (application/pdf)

Related works:
Journal Article: International Trade and the Environment: Theoretical and Policy Linkages (2006)
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