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Perseverance of Perverse Subsidies and their Impact on Trade and the Environment

Author

Listed:
  • Cees van Beers

    (Delft University of Technology)

  • Jeroen C.J.M. van den Bergh

    (Vrije Universiteit Amsterdam)

Abstract

Theoretical and empirical aspects of policy failures due to subsidies are discussed in the context of international trade. A general classification of subsidies that cause environmental externalities is presented. The economic and environmental impacts of producer subsidies on international trade are examined with partial equilibrium analysis. The magnitude and economic and environmental relevance of subsidies in various sectors is assessed on the basis of empirical indicators. Finally, suggestions are provided on how subsidy-related policy failures can be eliminated at national and international levels. This discussion paper has resulted in a publication in Ecological Economics , 2001, 36(3), 475-86.

Suggested Citation

  • Cees van Beers & Jeroen C.J.M. van den Bergh, 2000. "Perseverance of Perverse Subsidies and their Impact on Trade and the Environment," Tinbergen Institute Discussion Papers 00-005/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20000005
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    References listed on IDEAS

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    1. Heaps, Terry & Helliwell, John F., 1985. "The taxation of natural resources," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 1, chapter 8, pages 421-472, Elsevier.
    2. Alan M. Rugman & John J. Kirton & Julie A. Soloway (ed.), 1998. "Trade and the Environment," Books, Edward Elgar Publishing, number 1339.
    3. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249.
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    5. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    6. Ian W.H. Parry & Antonio M. Bento, 2002. "Tax Deductions, Environmental Policy, and the "Double Dividend" Hypothesis," Chapters, in: Lawrence H. Goulder (ed.), Environmental Policy Making in Economies with Prior Tax Distortions, chapter 22, pages 397-426, Edward Elgar Publishing.
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