Double Dividend with Trade Distortions: Analytical Results and Evidence from Chile
The double-dividend debate evolves around the possibility (or not) of substituting environmental taxes for more distortionary taxes to reduce both pollution degradation or damages (the first dividend) and the excess burden of existing taxes (the second dividend). This debate tends to center on labor market distortions, but this paper shifts the focus to trade and environmental distortions. Specifically, Beghin and Dessus empirically explore the trade/environment double-dividend with an applied general equilibrium model of the Chilean economy. Findings suggest that swapping environmental taxes for trade distortions in Chile does indeed improve welfare. Furthermore, the swap would pay for itself under the assumption of separable pollution damages from market-good consumption.
|Date of creation:||Sep 1999|
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- John Beghin & David Roland-Holts & Dominique van der Mensbrugghe, 1995.
"Trade Liberalization and the Environment in the Pacific Basin: Coordinated Approaches to Mexican Trade and Environment Policy,"
American Journal of Agricultural Economics,
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- Beghin, John C. & Roland-Holst, David & Van der Mensbrugghe, Dominique, 2005. "Trade Liberalization and the Environment in the Pacific Basin: Coordinated Approaches to Mexican Trade and Environment Policy," Staff General Research Papers Archive 12742, Iowa State University, Department of Economics.
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- Terkla, David, 1984. "The efficiency value of effluent tax revenues," Journal of Environmental Economics and Management, Elsevier, vol. 11(2), pages 107-123, June.
- John Beghin & David Roland-Holst & Dominique van der Mensbrugghe, 1997.
"Trade and Pollution Linkages: Piecemeal Reform and Optimal Intervention,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 30(2), pages 442-55, May.
- John Beghin & David Roland-Holst & Dominique van der Mensbrugghe, 1994. "Trade and Pollution Linkages: Piecemeal Reform and Optimal Intervention," OECD Development Centre Working Papers 99, OECD Publishing.
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- Ng, Yew-Kwang, 1980. "Optimal Corrective Taxes or Subsidies When Revenue Raising Imposes an Excess Burden," American Economic Review, American Economic Association, vol. 70(4), pages 744-51, September.
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