Recycling, International Trade, and the Distribution of Pollution: The Effect of Increased U.S. Paper Recycling on U.S. Import Demand for Canadian Paper
Posted: 31 Aug 1998
The quantity of paper recycled in the U.S. has more than doubled since 1985. International trade theory predicts that this will lead to reduced imports of paper, and a shift in domestic production toward waste paper intensive outputs (e.g., newsprint) and away from higher grade products such as printing/writing paper. Import demand elasticities with respect to input prices were estimated for newsprint, printing/writing, and all paper utilizing 20 years of monthly data. The empirical results confirm the predictions of theory, and illustrate a channel through which recycling may be more beneficial for U.S. industry than the domestic environment.
JEL Classification: Q21
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