IDEAS home Printed from https://ideas.repec.org/p/rsc/rsceui/2014-17.html
   My bibliography  Save this paper

A Turquoise Mess: Green Subsidies, Blue Industrial Policy and Renewable Energy: the Case for Redrafting the Subsidies Agreement of the WTO

Author

Listed:
  • Aaron Cosbey
  • Petros C. Mavroidis

Abstract

Canada-Renewable Energy presented the WTO Panel and Appellate Body (AB) with a novel Number: at the heart of the dispute was a measure adopted by the province of Ontario whereby producers of renewable energy would be paid a premium relative to conventional power producers. Some WTO Members complained that the measure was a prohibited subsidy because payments were conditional upon using Canadian equipment for the production of renewable energy. The AB gave them right only in part: it found that a local content requirement had indeed been imposed, but also found that it lacked evidence to determine whether a subsidy had been bestowed. The report is, for the reasons explained below, incoherent and could hardly serve as precedent for resolution of similar conflicts in the future. The facts of the case though, do raise legitimate questions both with respect to the specifics of the case, as well as of more general nature regarding the WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement), and the role of the judge when facing legislative failure. In this paper, we provide some responses to these questions in light of the theory and evidence regarding industrial policy in the name of environmental protection.

Suggested Citation

  • Aaron Cosbey & Petros C. Mavroidis, 2014. "A Turquoise Mess: Green Subsidies, Blue Industrial Policy and Renewable Energy: the Case for Redrafting the Subsidies Agreement of the WTO," RSCAS Working Papers 2014/17, European University Institute.
  • Handle: RePEc:rsc:rsceui:2014/17
    as

    Download full text from publisher

    File URL: http://cadmus.eui.eu/bitstream/handle/1814/29924/RSCAS_2014_17.pdf?sequence=1
    Download Restriction: no

    File URL: http://hdl.handle.net/1814/29924
    Download Restriction: no

    References listed on IDEAS

    as
    1. Rodrik, Dani, 2004. "Industrial Policy for the Twenty-First Century," Working Paper Series rwp04-047, Harvard University, John F. Kennedy School of Government.
    2. Henrik Horn & Giovanni Maggi & Robert W. Staiger, 2010. "Trade Agreements as Endogenously Incomplete Contracts," American Economic Review, American Economic Association, vol. 100(1), pages 394-419, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bougette, Patrice & Charlier, Christophe, 2015. "Renewable energy, subsidies, and the WTO: Where has the ‘green’ gone?," Energy Economics, Elsevier, vol. 51(C), pages 407-416.
    2. Carolyn Fischer, 2017. "Environmental Protection for Sale: Strategic Green Industrial Policy and Climate Finance," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 553-575, March.
    3. repec:spr:ieaple:v:17:y:2017:i:3:d:10.1007_s10784-017-9359-8 is not listed on IDEAS
    4. Charnovitz, Steve & Fischer, Carolyn, 2015. "Canada–Renewable Energy: Implications for WTO Law on Green and Not-So-Green Subsidies," World Trade Review, Cambridge University Press, vol. 14(02), pages 177-210, April.
    5. repec:spr:ieaple:v:17:y:2017:i:3:d:10.1007_s10784-017-9362-0 is not listed on IDEAS

    More about this item

    Keywords

    WTO; SUBSIDIES; RENEWABLE ENERGY;

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rsc:rsceui:2014/17. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (RSCAS web unit). General contact details of provider: http://edirc.repec.org/data/rsiueit.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.