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Economic integration and environmental policy coordination

Author

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  • Straume, Odd Rune

    () (Institute for Research in Economics and Business Administration (SNF) and University of Bergen, Department of Economics)

Abstract

We analyse the effect of international economic integration on environmental policy incentives when product markets are characterised by imperfect competition and national policy makers act strategically. If traditional trade policy instruments are not available, environmental policies will typically be determined by the interaction of conflicting policy incentives. We find that economic integration — interpreted as a reduction of non-tariff trade costs — will reduce policy distortions in the non-cooperative policy game if the marginal social cost of pollution is increasing at a sufficiently low rate. In this case, it follows that increased integration reduces the need for transnational policy coordination, from an environmentalist perspective.

Suggested Citation

  • Straume, Odd Rune, 2003. "Economic integration and environmental policy coordination," Working Papers in Economics 13/03, University of Bergen, Department of Economics.
  • Handle: RePEc:hhs:bergec:2003_013
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    File URL: http://www.uib.no/filearchive/13-03.pdf
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    Cited by:

    1. Ludek Kouba & Michal Madr & Danuse Nerudova & Petr Rozmahel, 2016. "Policy Autonomy, Coordination or Harmonization in the Persistently Heterogeneous European Union?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 1, pages 53-71, March.
    2. repec:wfo:wstudy:58136 is not listed on IDEAS

    More about this item

    Keywords

    Economic integration; Strategic environmental policy; Policy coordination.;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F15 - International Economics - - Trade - - - Economic Integration
    • F18 - International Economics - - Trade - - - Trade and Environment
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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