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European Union Environmental Policies And Imports Of Agricultural Products From The United States

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  • Larson, Bruce A.
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    Abstract

    The EU is the third largest regional export market for US agricultural products, with over $6 billion in annual sales. In principle, EU environmental policies designed to control domestic externalities could alter US agricultural exports to the EU. This paper develops a range of theoretically consistent and empirically relevant sectoral models that can be used to estimate the impact of environmental regulations on EU imports of US agricultural products. Section 2 reviews EU environmental policies to discuss how they may directly and indirectly affect EU demand for US agricultural imports. Section 3 develops models for size cases. Cases 1-3 are developed for homogeneous products. Case 1 assumes prices are fixed and the EU policy is a process regulation imposed on domestic producers. Case 2 extends Case 1 to include equilibrium price adjustments. Case 3 extends Case 2 to the situation where the EU policy is a product standard that affects both EU and US producers, although not necessarily in the same way. Cases 4-6 are developed for differentiated products. Case 4 focuses on EU process regulations with equilibrium price adjustments, and Case 5 extends the model to allow for eco-label policies that might shift EU consumer demands for both domestic and imported items. Case 6 extends Case 5 to allow for product standard policies in markets for differentiated products with eco-labels. Section 4 concludes.

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    Bibliographic Info

    Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2002 Annual meeting, July 28-31, Long Beach, CA with number 19613.

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    Date of creation: 2002
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    Handle: RePEc:ags:aaea02:19613

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    Keywords: Environmental Economics and Policy; International Relations/Trade;

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    Cited by:
    1. Colyer, Dale, 2004. "Environmental Regulations and Agricultural Competitiveness," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, Estey Centre for Law and Economics in International Trade, vol. 5(1).
    2. Colyer, Dale, 2004. "Environmental Regulations And Competitiveness," Working Papers, West Virginia University, Department of Agricultural Resource Economics 19100, West Virginia University, Department of Agricultural Resource Economics.

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