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Trade liberalization and the environment in Costa Rica

Author

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  • ABLER, DAVID G.
  • RODRÃ GUEZ, ADRIÃ N G.
  • SHORTLE, JAMES S.

Abstract

This study examines the environmental impacts of trade liberalization in Costa Rica. A CGE model is constructed which includes eight environmental indicators covering deforestation, pesticides, overfishing, hazardous wastes, inorganic wastes, organic wastes, greenhouse gases, and air pollution. Three trade liberalization scenarios are examined. Two sets of analyses are conducted for each scenario, one in which technologies do not change in response to trade liberalization and the other in which total factor productivity in each sector changes in response to changes in imports of machinery and equipment. To account for uncertainty regarding values of the model's parameters, a Monte Carlo experiment is conducted for each policy option. The impacts of trade liberalization on the environmental indicators are generally negative in sign but small or moderate in magnitude, both when technology is constant and when technology is allowed to vary.

Suggested Citation

  • Abler, David G. & Rodrã Guez, Adriã N G. & Shortle, James S., 1999. "Trade liberalization and the environment in Costa Rica," Environment and Development Economics, Cambridge University Press, vol. 4(3), pages 357-373, July.
    • Handle: RePEc:cup:endeec:v:4:y:1999:i:03:p:357-373_00
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    1. Farajzadeh, Zakariya & Zhu, Xueqin & Bakhshoodeh, Mohammad, 2017. "Trade reform in Iran for accession to the World Trade Organization: Analysis of welfare and environmental impacts," Economic Modelling, Elsevier, vol. 63(C), pages 75-85.
    2. ADKINS Liwayway G. & GARBACCIO Richard F., 2010. "Simulating the Effects of the FTAA on Global Carbon Emissions: A General Equilibrium Analysis," EcoMod2003 330700000, EcoMod.
    3. Perrings, Charles, 2014. "Environment and development economics 20 years on," Environment and Development Economics, Cambridge University Press, vol. 19(3), pages 333-366, June.
    4. Disli, Mustafa & Ng, Adam & Askari, Hossein, 2016. "Culture, income, and CO2 emission," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 418-428.
    5. Mohd Irfan & Krishnendu Shaw, 2017. "Modeling the effects of energy consumption and urbanization on environmental pollution in South Asian countries: a nonparametric panel approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 51(1), pages 65-78, January.
    6. Ghimire, Narishwar & Woodward, Richard T., 2013. "Under- and over-use of pesticides: An international analysis," Ecological Economics, Elsevier, vol. 89(C), pages 73-81.
    7. Muhammad Hasnain Khalid & Ihtisham ul Haq & Dilawar Khan & Khurram Abbas, 2022. "Exploring the Impact of Economic Structure on Carbon Emissions: A Case Study of Pakistan," International Journal of Energy Economics and Policy, Econjournals, vol. 12(3), pages 425-431, May.
    8. Pelkmans, Jacques, 2003. "European Integration, Deepening and Widening Economic Analysis," Conference papers 331166, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    9. Shahbaz, Muhammad & Kumar Tiwari, Aviral & Nasir, Muhammad, 2013. "The effects of financial development, economic growth, coal consumption and trade openness on CO2 emissions in South Africa," Energy Policy, Elsevier, vol. 61(C), pages 1452-1459.
    10. Charfeddine, Lanouar & Ben Khediri, Karim, 2016. "Financial development and environmental quality in UAE: Cointegration with structural breaks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 55(C), pages 1322-1335.
    11. Charfeddine, Lanouar, 2017. "The impact of energy consumption and economic development on Ecological Footprint and CO2 emissions: Evidence from a Markov Switching Equilibrium Correction Model," Energy Economics, Elsevier, vol. 65(C), pages 355-374.
    12. Faiz-Ur-Rehman & Mohammad Nasir & Amanat Ali, 2007. "Corruption, Trade Openness, and Environmental Quality: A Panel Data Analysis of Selected South Asian Countries," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 46(4), pages 673-688.
    13. Faiz Rehman & Muhammad Nasir & Faiza Kanwal, 2012. "Nexus between corruption and regional Environmental Kuznets Curve: the case of South Asian countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 14(5), pages 827-841, October.
    14. Muhammad, Shahbaz & Tiwari, Aviral & Muhammad, Nasir, 2011. "The effects of financial development, economic growth, coal consumption and trade openness on environment performance in South Africa," MPRA Paper 32723, University Library of Munich, Germany, revised 10 Aug 2011.
    15. Colyer, Dale, 2002. "Environmental Issues In The Ftaa," Conference Papers 19107, West Virginia University, Department of Agricultural Resource Economics.
    16. Nasir, Muhammad & Ur Rehman, Faiz, 2011. "Environmental Kuznets Curve for carbon emissions in Pakistan: An empirical investigation," Energy Policy, Elsevier, vol. 39(3), pages 1857-1864, March.
    17. Kais, Saidi & Sami, Hammami, 2016. "An econometric study of the impact of economic growth and energy use on carbon emissions: Panel data evidence from fifty eight countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 59(C), pages 1101-1110.

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