Abstract
Trade barriers may improve welfare if property rights with respect to renewable natural resources are lacking. Previous studies focus on the role of overharvesting, but we argue that trade-induced habitat destruction should also be taken into account. Habitat is one of the key factors determining the long-run viability of many natural resources, and economic activity oftentimes goes at the expense of habitat. While open access gives rise to within-industry externalities, habitat destruction creates across-industry externalities. We identify under what circumstances trade liberalization is welfare-enhancing as well as contributing to nature conservation, and analyze the consequences of trade policy. © 2004 Elsevier Inc. All rights reserved.
Original language | English |
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Pages (from-to) | 891-910 |
Number of pages | 20 |
Journal | Journal of Environmental Economics and Management |
Volume | 48 |
DOIs | |
Publication status | Published - 2004 |