Export Processing Zones and Environmental Policy
AbstractThis paper investigates the relation between an export processing zone and a pollution quota in a small country. The model suppose that the pollution target is implemented with a marketable permit system, and the government sets the quota to maximize domestic welfare. Then we show that, if an increase in real income reduces marginal external damage, the pollution quota is relieved by the formation of an export processing zone. However, if the marginal damage is augmented with an increase in the income, the optimal quota might be strengthened by the formation of the zone.
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Bibliographic InfoPaper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 06-22.
Length: 21 pages
Date of creation: Aug 2006
Date of revision:
export processing zone; international trade; environmental policy; pollution;
Find related papers by JEL classification:
- F18 - International Economics - - Trade - - - Trade and Environment
- O24 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-08-12 (All new papers)
- NEP-DEV-2006-08-12 (Development)
- NEP-ENV-2006-08-12 (Environmental Economics)
- NEP-INT-2006-08-12 (International Trade)
- NEP-RES-2006-08-12 (Resource Economics)
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.:
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NBER Working Papers
9823, National Bureau of Economic Research, Inc.
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