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Trade and Transboundary Pollution

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  • Copeland, Brian R
  • Taylor, M Scott

Abstract

This paper examines how national income and trading opportunities interact to determine the level and incidence of world pollution. The authors find that free trade raises world pollution if incomes differ substantially across countries; if trade equalizes factor prices, human-capital-abundant countries lose from trade, while human-capital-scarce countries gain; international trade in pollution permits can lower world pollution even when governments' supply of permits is unrestricted; international income transfers may not affect world pollution or welfare; and attempts to manipulate the terms of trade with pollution policy leave world pollution unaffected. Copyright 1995 by American Economic Association.

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 85 (1995)
Issue (Month): 4 (September)
Pages: 716-37

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Handle: RePEc:aea:aecrev:v:85:y:1995:i:4:p:716-37

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  1. Rauscher, Michael, 1991. "National environmental policies and the effects of economic integration," European Journal of Political Economy, Elsevier, vol. 7(3), pages 313-329, October.
  2. Dornbusch, Rudiger & Fischer, Stanley & Samuelson, Paul A, 1980. "Heckscher- Ohlin Trade Theory with a Continuum of Goods," The Quarterly Journal of Economics, MIT Press, vol. 95(2), pages 203-24, September.
  3. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
  4. Markusen, James R., 1975. "International externalities and optimal tax structures," Journal of International Economics, Elsevier, vol. 5(1), pages 15-29, February.
  5. Warr, Peter G., 1983. "The private provision of a public good is independent of the distribution of income," Economics Letters, Elsevier, vol. 13(2-3), pages 207-211.
  6. Dean, Judith M., 1992. "Trade and the environment : a survey of the literature," Policy Research Working Paper Series 966, The World Bank.
  7. Ludema, R.D. & Wooton, I., 1992. "Cross-Border Externalities and trade Liberalization: The Strategic Control of Pollution," UWO Department of Economics Working Papers 9202, University of Western Ontario, Department of Economics.
  8. Markusen, James R, 1975. "Cooperative Control of International Pollution and Common Property Resources," The Quarterly Journal of Economics, MIT Press, vol. 89(4), pages 618-32, November.
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