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Global Pollution: A Heckscher-Ohlin-Samuelson Model of Pigouvian Taxation

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Author Info
Robert E. Kohn (Southern Illinois University)
Abstract

It could be inferred from the externality literature that, in the absence of lump sum transfers between countries, global Pigouvian taxation would make pollution-intensive countries worse-off. This paper uses the "strong version" of the Heckscher-Ohlin-Samuelson model to demonstrate that a uniform Pigouvian tax shifts the terms-of-trade in favor of the polluting good so that on balance a more polluting country could be better-off and a less polluting country worse-off. This result is consistent with some empirical observations on environmental policy in industrialized countries as compared with that in newly developing countries.

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File URL: http://college.holycross.edu/eej/Volume17/V17N3P337_343.pdf
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Publisher Info
Article provided by Eastern Economic Association in its journal Eastern Economic Journal.

Volume (Year): 17 (1991)
Issue (Month): 3 (Jul-Sep)
Pages: 337-343
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Handle: RePEc:eej:eeconj:v:17:y:1991:i:3:p:337-343

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Related research
Keywords: Externality; Heckscher Ohlin; Lump Sum Transfer; Pigouvian Tax; Polluting; Pollution; Tax; Taxation; Terms of Trade; Trade;

Find related papers by JEL classification:
Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
F11 - International Economics - - Trade - - - Neoclassical Models of Trade
H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. McGuire, Martin C., 1982. "Regulation, factor rewards, and international trade," Journal of Public Economics, Elsevier, vol. 17(3), pages 335-354, April. [Downloadable!] (restricted)
  2. Kosobud, Richard F & Daly, Thomas A, 1984. "Global Conflict or Cooperation over the CO2 Climate Impact?," Kyklos, Blackwell Publishing, vol. 37(4), pages 638-59.
  3. Hahn, Robert W, 1989. "Economic Prescriptions for Environmental Problems: How the Patient Followed the Doctor's Orders," Journal of Economic Perspectives, American Economic Association, vol. 3(2), pages 95-114, Spring. [Downloadable!] (restricted)
  4. Asako, Kazumi, 1979. "Environmental Pollution in an Open Economy," The Economic Record, The Economic Society of Australia, vol. 55(151), pages 359-67, December.
  5. Pethig, Rudiger, 1976. "Pollution, welfare, and environmental policy in the theory of Comparative Advantage," Journal of Environmental Economics and Management, Elsevier, vol. 2(3), pages 160-169, February. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Robert Kohn, 1998. "Environmental Protection by One or Both Trading Partners in a Heckscher-Ohlin-Samuelson Model," Open Economies Review, Springer, vol. 9(4), pages 327-342, October. [Downloadable!] (restricted)
  2. Robert Kohn, 1995. "Salvatore model with equiproportional preservation of forests," Open Economies Review, Springer, vol. 6(1), pages 63-79, January. [Downloadable!] (restricted)
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