Embodied pollution and trade: a two-country general equilibrium model
The effects of environmental policy on trade and social welfare are analyzed in a modified Heckscher-Ohlin framework where pollution is embodied in a good consumed. Utility is non-homothetic to account for changes in the demand for healthy goods when income increases. If the polluting input is used...
| Autores principales: | , |
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| Formato: | Journal Article |
| Lenguaje: | Inglés |
| Publicado: |
1997
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| Materias: | |
| Acceso en línea: | https://hdl.handle.net/10568/171378 |
| _version_ | 1855514205527998464 |
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| author | Diao, Xinshen Roe, Terry L. |
| author_browse | Diao, Xinshen Roe, Terry L. |
| author_facet | Diao, Xinshen Roe, Terry L. |
| author_sort | Diao, Xinshen |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | The effects of environmental policy on trade and social welfare are analyzed in a modified Heckscher-Ohlin framework where pollution is embodied in a good consumed. Utility is non-homothetic to account for changes in the demand for healthy goods when income increases. If the polluting input is used intensively, taxing it alone can cause an increase in the good's level of pollution concentration. Instead, a tax on the polluting input in combination with a subsidy to the non-polluting input can result in Pareto improvement. Contrary to other approaches, an abatement policy does not necessarily have a negative effect on a country's comparative advantage. However, if the country is large, change in terms of trade may cause one country to be made better off at the expense of the other, which suggests that compensatory payments may be required to encourage abatement policies. |
| format | Journal Article |
| id | CGSpace171378 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 1997 |
| publishDateRange | 1997 |
| publishDateSort | 1997 |
| record_format | dspace |
| spelling | CGSpace1713782025-01-29T12:58:05Z Embodied pollution and trade: a two-country general equilibrium model Diao, Xinshen Roe, Terry L. environmental policies trade pollution social welfare The effects of environmental policy on trade and social welfare are analyzed in a modified Heckscher-Ohlin framework where pollution is embodied in a good consumed. Utility is non-homothetic to account for changes in the demand for healthy goods when income increases. If the polluting input is used intensively, taxing it alone can cause an increase in the good's level of pollution concentration. Instead, a tax on the polluting input in combination with a subsidy to the non-polluting input can result in Pareto improvement. Contrary to other approaches, an abatement policy does not necessarily have a negative effect on a country's comparative advantage. However, if the country is large, change in terms of trade may cause one country to be made better off at the expense of the other, which suggests that compensatory payments may be required to encourage abatement policies. 1997 2025-01-29T12:58:05Z 2025-01-29T12:58:05Z Journal Article https://hdl.handle.net/10568/171378 en Open Access Diao, Xinshen; Roe, Terry L. 1997. Embodied pollution and trade: a two-country general equilibrium model. Journal of Economic Development 22(1): 57. https://jed.cau.ac.kr/archives/22-1/22-1-5.pdf |
| spellingShingle | environmental policies trade pollution social welfare Diao, Xinshen Roe, Terry L. Embodied pollution and trade: a two-country general equilibrium model |
| title | Embodied pollution and trade: a two-country general equilibrium model |
| title_full | Embodied pollution and trade: a two-country general equilibrium model |
| title_fullStr | Embodied pollution and trade: a two-country general equilibrium model |
| title_full_unstemmed | Embodied pollution and trade: a two-country general equilibrium model |
| title_short | Embodied pollution and trade: a two-country general equilibrium model |
| title_sort | embodied pollution and trade a two country general equilibrium model |
| topic | environmental policies trade pollution social welfare |
| url | https://hdl.handle.net/10568/171378 |
| work_keys_str_mv | AT diaoxinshen embodiedpollutionandtradeatwocountrygeneralequilibriummodel AT roeterryl embodiedpollutionandtradeatwocountrygeneralequilibriummodel |