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Trade Liberalization and Environmental Regulation on International Transportation

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  • Kenzo Abe
  • Keisuke Hattori
  • Yoshitaka Kawagoshi

Abstract

type="main"> Incorporating pollution emissions from international transportation into a model of strategic trade and environmental policies, we investigate the effect of trade liberalization and environmental regulation on national welfare and the environment. Our model includes imperfectly competitive markets for international transportation and final products. We find that trade liberalization may reduce each country's welfare unless some level of environmental regulation on international transportation is in place. When international trade is liberalized initially, a mutual increase in the common emission tax rates may improve each country's welfare. However, when international trade is highly protected initially, imposing an emission tax may reduce welfare.

Suggested Citation

  • Kenzo Abe & Keisuke Hattori & Yoshitaka Kawagoshi, 2014. "Trade Liberalization and Environmental Regulation on International Transportation," The Japanese Economic Review, Japanese Economic Association, vol. 65(4), pages 468-482, December.
  • Handle: RePEc:bla:jecrev:v:65:y:2014:i:4:p:468-482
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    File URL: http://hdl.handle.net/10.1111/jere.12044
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    References listed on IDEAS

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    1. Cristea, Anca & Hummels, David & Puzzello, Laura & Avetisyan, Misak, 2013. "Trade and the greenhouse gas emissions from international freight transport," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 153-173.
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    7. Andriamananjara, Soamiely, 2004. "Trade and International Transport Services: an Analytical Framework," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 19, pages 604-625.
    8. Takumi Naito & Kenzo Abe, 2008. "Welfare- and Revenue-Enhancing Tariff and Tax Reform under Imperfect Competition," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(6), pages 1085-1094, December.
    9. Takahashi, Takaaki, 2006. "Economic geography and endogenous determination of transport technology," Journal of Urban Economics, Elsevier, vol. 60(3), pages 498-518, November.
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    Cited by:

    1. Takauchi, Kazuhiro, 2015. "Strategic export policy, monopoly carrier, and product differentiation," MPRA Paper 66003, University Library of Munich, Germany.
    2. repec:eee:inecon:v:111:y:2018:i:c:p:81-98 is not listed on IDEAS
    3. Kazuhiro Takauchi & Tomomichi Mizuno, 2017. "Solving a hold-up problem may harm all firms: downstream R&D and transport-price contracts," Discussion Papers 1707, Graduate School of Economics, Kobe University.
    4. ISHIKAWA, Jota & TARUI, Norio, 2017. "Backfiring with Backhaul Problems: Trade and Industrial Policies with Endogenous Transport Costs," Discussion paper series HIAS-E-57, Hitotsubashi Institute for Advanced Study, Hitotsubashi University.
    5. Jota Ishikawa & Nori Tarui, 2015. "Backfiring with backhaul problems: Trade and Industrial Policies with Endogenous Transport Costs," Working Papers 201514, University of Hawaii at Manoa, Department of Economics.
    6. Takauchi, Kazuhiro, 2016. "Profit-reducing fixed-price contract: The role of the transport sector," MPRA Paper 71413, University Library of Munich, Germany.
    7. Takauchi, Kazuhiro, 2015. "Transport efficiency, downstream R&D, and spillovers," MPRA Paper 68479, University Library of Munich, Germany.

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