Trade Liberalisation and Greenhouse Gas Emissions: The Case of Dairying in the European Union and New Zealand

18 Pages Posted: 2 Nov 2006

See all articles by Caroline M. Saunders

Caroline M. Saunders

Lincoln University (NZ) - Economics Group

Anita Wreford

University of East Anglia (UEA) - School of Environmental Sciences

Abstract

The link between trade and the environment has aroused considerable interest both in terms of the impact of trade liberalisation on the environment, and also the impact of environmental policy on production and trade. Of key environmental concern at present is global warming and its association with greenhouse gas emissions. Agriculture is a sector of the economy that both contributes to, and will be affected by, climate change. This paper models the impact of agricultural trade liberalisation on greenhouse gas emissions from agriculture around the world, focusing particularly on the effects on New Zealand, a small economy highly dependent on agricultural trade. A partial equilibrium agricultural multicountry, multicommodity trade model is used for the analysis, extended to include physical production systems and their greenhouse gas emissions. Two simulations are performed: removal of agricultural policies in the EU and in all OECD countries. The results indicate that although producer returns in New Zealand increase, greenhouse gas emissions also increase significantly. EU producers face lower returns but also lower greenhouse gas emissions.

Suggested Citation

Saunders, Caroline M. and Wreford, Anita, Trade Liberalisation and Greenhouse Gas Emissions: The Case of Dairying in the European Union and New Zealand. Australian Journal of Agricultural and Resource Economics, Vol. 50, No. 4, pp. 538-555, December 2006, Available at SSRN: https://ssrn.com/abstract=941828 or http://dx.doi.org/10.1111/j.1467-8489.2006.00343.x

Caroline M. Saunders (Contact Author)

Lincoln University (NZ) - Economics Group ( email )

Canterbury
New Zealand
+64 (3) 325-3627 (Phone)
+64 (3) 325 3847 (Fax)

HOME PAGE: http://www.lincoln.ac.nz/comm/profiles/saunderc.htm

Anita Wreford

University of East Anglia (UEA) - School of Environmental Sciences ( email )

Norwich, NR4 7TJ
United Kingdom
+44 1603 593904 (Phone)
+44 1603 591327 (Fax)

HOME PAGE: http://www.uea.ac.uk/env/people/wreforda/index.shtml

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