Chapter 11 Controversies in Trade Policy Globalization and the Environment

Globalization, Growth, and Pollution The idea is that a country’s income per capita rises due to economic growth, the initial effect is growing damage to the environment. But when a country gets sufficiently rich, it can afford to take action to protect the environment. Kuznets curve

Point: Trade liberalization is often advocated on the grounds that it will promote economic growth. On the other hand will this improve or worsen environmental quality? It depends which side of the environmental Kuznets curve an economy is on. E.g.: Grossman and Krueger suggested that Mexican might be on the right side of the curve—that is, to the extent that NAFTA raised Mexican income, it would actually lead to a reduction in environment damage

The Problem of “Pollution Havens” This principle says that a company would want to locate in a country with the lowest environmental standards. Pollution haven theory posits that foreign investors from industrial countries are attracted to weak environmental regulations in developing countries.

The Problem of “Pollution Havens” Rich countries usually have strict environmental regulations and poor countries do not, environmentally hazardous activities may be moved to poor countries.

The Problem of “Pollution Havens” Two questions ： 1 Whether pollution havens are really an important factor 2 Whether pollution havens deserve to be a subject of international negotiation We think that in the pollution heavens ， the higher environmental standards should be imposed. And the government should interfere with the pollution havens. Though it earned interest, but at the same time, serious damage to the environment is costless. The impact of environmental pollution is a long time, and we can not lose the greater one. Opinion:

Environmental Issues and Trade Negotiations There is a widespread misconception that existing international trade rules stand in the way of environmental protection. In fact,countries are free to impose whatever environmental rules they choose, as long as they do so in a nondiscriminatory way Nonetheless, there are some potential conflicts looming, especially in addressing the issue of climate change. The intersection of domestic climate change policies potentially explosive area.

Chapter 11 Controversies in Trade Policy Globalization and the Environment Thank you for watching Group: 虞绮霞 施凌燕 吴晓超