IDEAS home Printed from https://ideas.repec.org/h/spr/conchp/978-981-97-5652-0_12.html

Controlling Environmental Pollution, Sectoral Composition and Factor Prices: A H–O and SFM Hybrid Approach

In: International Trade, Resource Mobility and Adjustments in a Changing World

Author

Listed:
  • Biswajit Mandal

    (Visva-Bharati University)

  • Arya Roy Bardhan

    (Observer Research Foundation)

  • Saswati Chaudhuri

    (St. Xavier’s College (Autonomous))

Abstract

The consternation regarding environment is manifold. One of them is environmental quality which has both short-run and long-run implications including sustainable development goals. In view of such apprehension, this paper develops a Heckscher–Ohlin nugget kind of competitive general equilibrium model with four sectors and four factors of production to analyse the effect of tax policy to curb environmental pollution. Surprisingly we find that environmental tax on the polluting sector eventually raises the production of polluting output and widens the wage inequality between skilled and unskilled labour. On the other hand, taxing the non-polluting sector yields the desired outcome in both production and factor income. The possibility of vanishing sector strengthens the counterintuitive results we get in case of taxing the non-polluting sector. Such an intriguing outcome is driven by the recursive nature of structure of the H–O nugget model. We empirically test the efficacy of environmental taxes using a system-GMM dynamic panel data on 10 OECD countries for 1997–2020 and find that environmental taxes have a deleterious effect on the environmental quality.

Suggested Citation

  • Biswajit Mandal & Arya Roy Bardhan & Saswati Chaudhuri, 2024. "Controlling Environmental Pollution, Sectoral Composition and Factor Prices: A H–O and SFM Hybrid Approach," Contributions to Economics, in: Sugata Marjit & Biswajit Mandal (ed.), International Trade, Resource Mobility and Adjustments in a Changing World, chapter 0, pages 259-291, Springer.
    • Handle: RePEc:spr:conchp:978-981-97-5652-0_12
    DOI: 10.1007/978-981-97-5652-0_12
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a
    for a similarly titled item that would be available.

    Other versions of this item:

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F18 - International Economics - - Trade - - - Trade and Environment
    • F6 - International Economics - - Economic Impacts of Globalization

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:conchp:978-981-97-5652-0_12. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.