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Environmental migration and capital mobility

Author

Listed:
  • Chao, Chi-Chur
  • Ee, Mong Shan
  • Laffargue, Jean-Pierre
  • Yu, Eden S.H.

Abstract

Based on utility equalization, this paper considers a developing economy with labor migration. Pollution and capital taxes are imposed on producers in the polluted sector. The optimal policy combinations of capital taxes and pollution taxes for the host economy are examined. A zero capital tax is required for increasing mobility of capital to raise real GDP, while a larger than Pigovian pollution tax is needed for enhancing environmental amenities. The impacts on those two optimal tax rates are examined theoretically and numerically if foreign countries adopt higher environmental standards or if foreign countries impose tax credits on foreign investments.

Suggested Citation

  • Chao, Chi-Chur & Ee, Mong Shan & Laffargue, Jean-Pierre & Yu, Eden S.H., 2016. "Environmental migration and capital mobility," International Review of Economics & Finance, Elsevier, vol. 42(C), pages 430-441.
    • Handle: RePEc:eee:reveco:v:42:y:2016:i:c:p:430-441
    DOI: 10.1016/j.iref.2015.10.014
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    References listed on IDEAS

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    1. Todaro, Michael P, 1969. "A Model for Labor Migration and Urban Unemployment in Less Developed Countries," American Economic Review, American Economic Association, vol. 59(1), pages 138-148, March.
    2. Ethier,Wilfred J. & Helpman,Elhanan & Neary,J. Peter (ed.), 1993. "Theory, Policy and Dynamics in International Trade," Cambridge Books, Cambridge University Press, number 9780521434423.
    3. Bond, Eric W., 1991. "Optimal tax and tariff policies with tax credits," Journal of International Economics, Elsevier, vol. 30(3-4), pages 317-329, May.
    4. Michel Beine & Christopher Parsons, 2015. "Climatic Factors as Determinants of International Migration," Scandinavian Journal of Economics, Wiley Blackwell, vol. 117(2), pages 723-767, April.
    5. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    6. Wang, Hua, 2002. "Pollution regulation and abatement efforts: evidence from China," Ecological Economics, Elsevier, vol. 41(1), pages 85-94, April.
    7. Jiang, Liangliang & Lin, Chen & Lin, Ping, 2014. "The determinants of pollution levels: Firm-level evidence from Chinese manufacturing," Journal of Comparative Economics, Elsevier, vol. 42(1), pages 118-142.
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    Cited by:

    1. Xiang Li & Shuang Xu & Yecui Hu, 2020. "Understanding the Rural Livelihood Stability System: The Eco-Migration in Huanjiang County, China," Sustainability, MDPI, vol. 12(16), pages 1-18, August.
    2. Brisbois, Marie Claire & Morris, Michelle & de Loë, Rob, 2019. "Augmenting the IAD framework to reveal power in collaborative governance – An illustrative application to resource industry dominated processes," World Development, Elsevier, vol. 120(C), pages 159-168.
    3. Cozzi, Guido & Galli, Silvia & Mantovan, Noemi, 2018. "Will a shrink make you richer? Gender differences in the effects of psychotherapy on labour efficiency," European Economic Review, Elsevier, vol. 109(C), pages 257-274.
    4. Constantin-Marius APOSTOAIE, 2016. "Assessing National Environmental Performance In The Eastern Partnership Countries," EURINT, Centre for European Studies, Alexandru Ioan Cuza University, vol. 3, pages 149-168.
    5. Boris Rigod & Patricia Tovar, 2018. "Indonesia – Chicken: Tensions between international trade and domestic food policies?," RSCAS Working Papers 2018/58, European University Institute.
    6. Lucken, Emma & Trapenberg Frick, Karen & Shaheen, Susan, 2019. "“Three Ps in a MOD:” Role for mobility on demand (MOD) public-private partnerships in public transit provision," Institute of Transportation Studies, Research Reports, Working Papers, Proceedings qt2k2550ct, Institute of Transportation Studies, UC Berkeley.

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    More about this item

    Keywords

    Environmental migration; pollution tax; capital tax;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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