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.

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.

• Item Type: MPRA Paper
• Language: English
• Keywords: environmental standards, abatement, international trade, MFN clause
• Subjects: F - International Economics > F1 - Trade > F12 - Models of Trade with Imperfect Competition and Scale Economies ; Fragmentation; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q56 - Environment and Development ; Environment and Trade ; Sustainability ; Environmental Accounts and Accounting ; Environmental Equity ; Population Growth

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