Is Free Trade Good for the Environment?

67 Pages Posted: 3 Sep 1998 Last revised: 1 May 2022

See all articles by Werner Antweiler

Werner Antweiler

University of British Columbia (UBC) - Sauder School of Business

Brian R. Copeland

University of British Columbia

M. Scott Taylor

University of Calgary - Department of Economics

Date Written: August 1998

Abstract

This paper sets out a theory of how openness to international goods markets affects pollution concentrations. We develop a theoretical model to divide trade's impact on pollution into scale, technique, and composition effects and then examine this theory using data on sulfur dioxide concentrations when it alters the composition, and hence the pollution intensity, of national output. Our estimates of the associated technique and scale efforts created by trade imply a net reduction in pollution from these sources. Combining our estimates of scale, composition, and technique efforts yields a somewhat surprising conclusion: freer trade appears to be good for the environment.

Suggested Citation

Antweiler, Werner and Copeland, Brian and Taylor, Michael Scott, Is Free Trade Good for the Environment? (August 1998). NBER Working Paper No. w6707, Available at SSRN: https://ssrn.com/abstract=111280

Werner Antweiler

University of British Columbia (UBC) - Sauder School of Business ( email )

2053 Main Mall
Vancouver, BC V6T 1Z2
Canada

Brian Copeland

University of British Columbia ( email )

997-1873 East Mall
Vancouver, BC V6T 1Z1
Canada
604-822-8215 (Phone)

Michael Scott Taylor (Contact Author)

University of Calgary - Department of Economics ( email )

2500 University Drive, NW
Calgary, Alberta T2N 1N4
Canada

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