Transboundary Movements of Waste
AbstractIn a stylized model of international trade, a monopolist in the North exports second-hand products to a representative firm in the South to be reused as intermediate goods, with potential trade gains. The degree of reusability of waste products is a crucial choice variable in the North. This is because with a lack of international vigilance, non-reusable waste can be mixed illegally with the reusable waste. I explore the driving forces for the movement of illegal waste, paying particular attention to the role of local waste regulations, such as the EU's Waste Electrical and Electronic Equipment directive. Under mild conditions, it is shown that increased regulation stringency in the North leads its firm to reduce the degree of reusability of its products. As a result, the flow of non-reusable waste to the South increases, providing another channel for the Pollution Haven Hypothesis.
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Bibliographic InfoPaper provided by University of Ottawa, Department of Economics in its series Working Papers with number 1006E.
Length: 16 pages
Date of creation: 2010
Date of revision:
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second-hand products; illegal waste; environmental regulation; trade;
Find related papers by JEL classification:
- F18 - International Economics - - Trade - - - Trade and Environment
- L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
- O20 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - General
- Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-09-18 (All new papers)
- NEP-CWA-2010-09-18 (Central & Western Asia)
- NEP-ENV-2010-09-18 (Environmental Economics)
- NEP-REG-2010-09-18 (Regulation)
- NEP-RES-2010-09-18 (Resource Economics)
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