Munich Personal RePEc Archive

The Role of MFN under Asymmetries in Environmental Standards

Missios, Paul and Yildiz, Halis Murat (2006): The Role of MFN under Asymmetries in Environmental Standards. Published in: Economics Letters , Vol. 93, No. 2 (2006): pp. 297-304.

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Abstract

We critically examine the implications of the most favored nation (MFN) clause under asymmetric environmental standards. Using an oligopolistic intra-industry trade model, we show that environmentally beneficial trade diversion and higher world welfare obtain under tariff discrimination relative to MFN.

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