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The role of green tariffs in environmental harmonization


  • Alireza Naghavi


This paper investigates the link between trade and environment by exploring the effects of green tariffs on the location of firms, innovation and environmental policy. Besides the standard effect of reducing trade and production of dirty goods, green tariffs discourage firms from relocating to pollution havens and induce them to engage in pollution abatement R&D instead. With no concern about pollution among Southern residents, green tariffs can block delocation to serve as the only means of persuading the South to harmonize its environmental standards. When some concern exists, tougher environmental regulations are adopted for a wider range of standards.

Suggested Citation

  • Alireza Naghavi, 2004. "The role of green tariffs in environmental harmonization," Working Papers 200407, School of Economics, University College Dublin.
  • Handle: RePEc:ucn:wpaper:200407

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    More about this item


    Environmental standards; Eco-dumping; Multinationals; Location of firms; Pollution abatement R&D; WTO; Green tariffs; International trade--Environmental aspects; Environmental impact charges; Industrial location; International business enterprises--Environmental aspects;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F18 - International Economics - - Trade - - - Trade and Environment
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy


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