now let's consider the issue of whether
international trade helps or hurts the
environment this is a quite complicated
question so don't expect a simple answer
at the end but let's just think through
a few of the key mechanisms at work
first wealth effects operate so a lot of
environmental problems they become
better with wealth countries either
obtain the resources or the capabilities
or the technologies to improve their
environments or as they become wealthier
they're simply more interested in living
in a clean setting a smaller number of
environmental problems seem to become
worse with wealth and here carbon
emissions would be a simple example as
countries produce more they tend to emit
more carbon into the atmosphere some
environmental problems first become
worse with wealth and then become better
so imagine a country that becomes
wealthier and then it has cars well in
the short run air pollution goes up as
the country becomes wealthier they tend
to ban say leaded gasoline and then the
air becomes cleaner again Mexico City is
an example of a region that has become
significantly wealthier and also has
moved toward much cleaner air economists
are fond of citing something called the
kuzmichev and this shows that many
environmental problems start to improve
as countries reach the middle income
range and GDP per capita it's a range of
about five to eight thousand dollars per
year a much longer run factor is that
greater wealth tends to lower birth
rates and that means in the longer run
less population and that will in some
ways put less pressure on the
environment some discussions of trade in
the environment slit the problem up in a
slightly different way so they will say
on one side of the ledger there are
technique effects and composition
effects which tend to make countries
cleaner technique effects mean you have
access to cleaner technologies of
production composition effects mean that
you want cleaner outputs and on the
other side of the ledger are scale
effects
see how effects mean that by producing
more you may be creating more pollution
another relevant factor is simply that
international trade tends to minimize
private costs of production so for
instance say you're considering a
comparison should you for instance ship
grapes in from Chile on a boat or should
you truck in grapes from California
using of course roads and gasoline
private entrepreneurs will compare the
costs of energy and transport and
basically they're looking to pick the
option which lowers those costs and in
general that tends to be environmentally
more friendly still we need to be
careful here what the market is
minimizing is private costs of
production and private and social costs
are not always the same especially with
regard to the environment for instance
some fuels may be environmentally
dirtier than others but this difference
is not always reflected in the price of
those fuels the literature on the
environment and trade also considers the
question of whether there is some kind
of race to the bottom with regard to
environmental standards now the evidence
on this seems to be that overall the
world is investing more resources in
protecting the environment but still we
can see a notable trend where
entrepreneurs are shifting the
production of pollution and pollution
producing goods to poorer countries just
to put it quite simply you don't see a
factory like this being located in
Beverly Hills the residents simply
wouldn't put up with it but you very
often do see factories just like that
located in China the last time I went to
China I was there I think for eight days
and I saw the blue sky only one out of
those eight days in Beijing that of
course is one source of pollution
there's very often a normative debate
about the shifting of pollution
producing activities to poorer countries
some individuals are seeking to argue
normatively that this is efficient and
it's a good thing while other
individuals take the point of view of
that this is extremely unfair that
debate lies outside the narrow bounds of
eken
comics but we can state a few general
trends first in most environmental areas
over time wealthy countries tend to
become cleaner and trade helps them do
that
the second general trend is that if we
have poorer but ambitious countries that
want to grow they may well become much
dirtier but in becoming dirtier they
also will grow faster and of course
China is an example of that note also
that in the much longer run those poorer
ambitious but growing dirtier countries
may in the longer run actually become
much cleaner for instance South Korea
was a much more polluted country several
decades ago the air in Seoul the capital
city was quite bad but now Seoul is
quite a pleasant place to be if you look
at North Korea up here what you find is
lower levels of pollution but they're
also much poorer and they've yet to go
down the entire track of in some ways
first becoming a dirtier place and in
later ways then cleaning up with
prosperity there's really a large amount
of reading you can do on this topic but
just a few of many places to start
there's a good survey article by Daniel
SD called bridging the trade environment
divide that's online there's also a good
Journal article called is free trade
good for the environment
you can google the phrase Kuzon it's
curved to many useful readings also
quite general but you can google trade
in the environment if you'd like a book
a lot of peer eating's are collected in
handbook on trade in the environment and
in general precisely because this is
such a complex and diverse area i
recommend that you google specific issue
areas that you may be interested in
you