Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/104557 
Year of Publication: 
2014
Series/Report no.: 
Research Papers in Economics No. 4/14
Publisher: 
Universität Trier, Fachbereich IV – Volkswirtschaftslehre, Trier
Abstract: 
The literature on trade liberalization and environment has not considered federal structures. This paper shows how the design of environmental policy in a federal system has implications for the effects of trade reform. Trade liberalization leads to a decline in pollution taxes regardless of whether pollution taxes are set at the federal (centralized) or local (decentralized) level, and it increases social welfare. The effect under a decentralized system is smaller than if these taxes are set by the federal government, and pollution emissions therefore decline in this case. Moreover, majority bias interacts with trade liberalization if federal taxes are used.
Subjects: 
trade and environment
environmental policy
trade liberalization
environmental federalism
political economy
majority bias
social welfare
JEL: 
F1
H2
H7
Q2
Document Type: 
Working Paper

Files in This Item:
File
Size
338.04 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.