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Export Processing Zones and Environmental Policy

Author

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  • Yasuyuki Sugiyama

    (Graduate School of Economics, Osaka University)

Abstract

This paper investigates the relation between an export processing zone and a pollution quota in a small country. The model suppose that the pollution target is implemented with a marketable permit system, and the government sets the quota to maximize domestic welfare. Then we show that, if an increase in real income reduces marginal external damage, the pollution quota is relieved by the formation of an export processing zone. However, if the marginal damage is augmented with an increase in the income, the optimal quota might be strengthened by the formation of the zone.

Suggested Citation

  • Yasuyuki Sugiyama, 2006. "Export Processing Zones and Environmental Policy," Discussion Papers in Economics and Business 06-22, Osaka University, Graduate School of Economics.
    • Handle: RePEc:osk:wpaper:0622
    as

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    File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/0622.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    export processing zone; international trade; environmental policy; pollution;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy

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    This paper has been announced in the following NEP Reports:

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