Environmental control, wage inequality and national welfare in a tourism economy
AbstractThis paper examines the effects of stricter environmental regulation on income distribution and welfare for an open economy with inbound tourism. The pollution input is considered as a mobile factor between sectors, and a decrease in it lowers wages of skilled labor in the traded sector but can increase the wages of unskilled labor in the non-traded sector. A stricter policy on environmental controls can narrow wage inequality and increase welfare if the tourism terms-of-trade effect dominates. These results are confirmed by simulations.
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Bibliographic InfoArticle provided by Elsevier in its journal International Review of Economics & Finance.
Volume (Year): 22 (2012)
Issue (Month): 1 ()
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Web page: http://www.elsevier.com/locate/inca/620165
Environmental control; Wage inequality; Welfare; Tourism;
Find related papers by JEL classification:
- F10 - International Economics - - Trade - - - General
- Q38 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Government Policy (includes OPEC Policy)
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