Trade, technical progress and the environment: the role of a unilateral green tax on consumption
The paper proposes a two-country general equilibrium model of endogenous growth and trade between two regions, North and South, with different environmental standards. Pollution is a by-product of consumption and in order to abate it the northern region unilaterally imposes a green tax on consumption. As the tax affects domestic demand of consumer goods according to their pollution intensities, regardless of where those goods are produced, the model shows that such a unilateral environmental policy can increase the speed of technological change and pollution abatement in both regions.
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- Pietro Peretto, 2008. "Effluent taxes, market structure, and the rate and direction of endogenous technological change," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 39(2), pages 113-138, February.
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NBER Working Papers
9823, National Bureau of Economic Research, Inc.
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- McAusland, Carol, 2008.
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Elsevier, vol. 55(1), pages 52-71, January.
- McAusland, Carol, 2003. "Trade, Politics,and the Environment: Tailpipe vs. Smokestack," University of California at Santa Barbara, Economics Working Paper Series qt0406x646, Department of Economics, UC Santa Barbara.
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