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Trade And The Environment: Economic And Environmental Impacts Of Global Dairy Trade Liberalisation

Author

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  • CAROLINE SAUNDERS

    (Agribusiness and Economics Research Unit, Lincoln University, Canterbury, New Zealand)

  • SELIM CAGATAY

    (Department of Economics, Hacettepe University, Turkey)

Abstract

This paper presents a partial equilibrium model of dairy sector international trade which has been extended to include physical dairy production systems and their effect on water quality. This combined model, LTEM (Lincoln Trade and Environment Model), is then used to simulate the effects of liberalisation policies on trade flows, dairy production systems and groundwater nitrate levels across different countries. The results show expected variation in price and production impacts, but also varying effects on groundwater quality between and within countries. More specifically, whilst liberalisation lowers dairy production in the EU and reduces the EU nitrate pollution slightly, the balancing production increases elsewhere lead to marginally higher pollution in other countries. This is of policy relevance given contemporary debates about the likely net environmental effect of further trade liberalisation.

Suggested Citation

  • Caroline Saunders & Selim Cagatay, 2004. "Trade And The Environment: Economic And Environmental Impacts Of Global Dairy Trade Liberalisation," Journal of Environmental Assessment Policy and Management (JEAPM), World Scientific Publishing Co. Pte. Ltd., vol. 6(03), pages 339-365.
    • Handle: RePEc:wsi:jeapmx:v:06:y:2004:i:03:n:s1464333204001766
    DOI: 10.1142/S1464333204001766
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    References listed on IDEAS

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    1. Tyers,Rod & Anderson,Kym, 2011. "Disarray in World Food Markets," Cambridge Books, Cambridge University Press, number 9780521172318.
    2. Leuck, Dale J. & Haley, Stephen L. & Liapis, Peter S. & McDonald, Bradley, 1995. "The EU Nitrate Directive and CAP Reform: Effects on Agricultural Production, Trade and Residual Soil Nitrogen," Foreign Agricultural Economic Report (FAER) 148007, United States Department of Agriculture, Economic Research Service.
    3. Haley, Stephen L., 1993. "Environmental And Agricultural Policy Linkages In The European Community: The Nitrate Problem And Cap Reform," Working Papers 51117, International Agricultural Trade Research Consortium.
    4. Roningen, Vernon & Dixit, Praveen & Sullivan, John & Hart, Tracy, 1991. "Overview of the Static World Policy Simulation (SWOPSIM) Modeling Framework," Staff Reports 278513, United States Department of Agriculture, Economic Research Service.
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    Cited by:

    1. Toma, Luiza & Mathijs, Erik & Revoredo-Giha, Cesar, 2006. "Linkages between Agriculture, Trade and the Environment in the Context of the European Union Accession," Working Papers 45991, Scotland's Rural College (formerly Scottish Agricultural College), Land Economy & Environment Research Group.

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    More about this item

    Keywords

    Trade liberalisation; partial equilibrium trade modelling; dairy production systems; groundwater nitrate concentration; JEL Classification F18; JEL Classification Q17; JEL Classification Q18;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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