Staff Publications

Staff Publications

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    'Staff publications' is the digital repository of Wageningen University & Research

    'Staff publications' contains references to publications authored by Wageningen University staff from 1976 onward.

    Publications authored by the staff of the Research Institutes are available from 1995 onwards.

    Full text documents are added when available. The database is updated daily and currently holds about 240,000 items, of which 72,000 in open access.

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Record number 539664
Title The conservation effects of trade with imperfect competition and biased policymakers
Author(s) Shao, Qianqian; Janus, Thorsten; Punt, Maarten J.; Wesseler, Justus
Source Agriculture 8 (2018)7. - ISSN 2077-0472
Department(s) Agricultural Economics and Rural Policy Group
Environmental Economics and Natural Resources Group
Publication type Refereed Article in a scientific journal
Publication year 2018
Keyword(s) Environmental conservation - International trade - Race to the bottom - Race to the top - Reciprocal dumping

In this paper, we study the effects of international trade on forest conservation and welfare in a two-country model with industry-biased policymakers and Cournot-competing firms. We find that opening up to trade increases the harvest taxes that the industry-biased governments impose compared to the autarky taxes. The tax increase is large enough to decrease the production levels, which leads to higher conservation levels. In addition, the numerical simulation predicts that increasing the industry-bias monotonically increases (i) the positive tax effect, (ii) the positive conservation effect, and (iii) the welfare gains from trade. The intuition behind the results is that industry-biased governments already degrade the environment under autarky, so even a highly-distorted trade outcome can be welfare-improving. We conclude that, even if industry bias decreases conservation, it does not have to increase the environmental costs of trade.

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