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Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes

Author

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  • Metcalfe, Mark R.
  • Beghin, John C

Abstract

We incorporate endogenous (price-responsive) consumption pollution into a dual trade model to assess welfare effects of coordinated trade and environmental piecemeal reform in a small, open and distorted economy. Pollution is generated by production and consumption. Producers control the level of pollution and face incentives to abate both types of pollution. We identify sufficient conditions for welfare-improving reforms of trade and environmental policies. An additional domestic environmental policy instrument must be imposed on exportables because of their supply response to foreign environmental taxes.

Suggested Citation

  • Metcalfe, Mark R. & Beghin, John C, 2015. "Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes," ISU General Staff Papers 201501010800001054, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genstf:201501010800001054
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    Cited by:

    1. Mark R Metcalfe & John C Beghin, 2015. "Piecemeal Reform of Trade and Environmental Policy When Consumption Also Pollutes," Economics Bulletin, AccessEcon, vol. 35(4), pages 2282-2287.
    2. Takumi Haibara, 2023. "Three tax reforms with and without public pollution abatement," Economics Bulletin, AccessEcon, vol. 43(1), pages 574-582.
    3. Park, Dooho & Seidl, Andrew & Davies, Stephen, 2002. "Environmental Policy and Industry Location: The Case of the U.S. Livestock Industry," The Review of Regional Studies, Southern Regional Science Association, vol. 32(2), pages 293-307, Summer/Fa.
    4. Park, Dooho & Davies, Stephen P. & Seidl, Andrew F., 2001. "A Nationwide, State-Level, Analysis Of Animal Confinement Policy By Selected Species," 2001 Annual Meeting, July 8-11, 2001, Logan, Utah 36160, Western Agricultural Economics Association.
    5. Park, Dooho & Seidl, Andrew F. & Davies, Stephen P. & Frasier, W. Marshall, 2000. "Environmental Policy Influences On Livestock Stocking And Location Decisions," 2000 Annual Meeting, June 29-July 1, 2000, Vancouver, British Columbia 36340, Western Agricultural Economics Association.
    6. Leonard F.S. Wang & Tai-Liang Chen & Ya-Chin Wang, 2007. "Trade liberalization and environmental tax in differentiated oligopoly with consumption externalities," Economics Bulletin, AccessEcon, vol. 17(9), pages 1-9.

    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation

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