Premium
Politiques tarifaires et environnementales quand il y a des standards pour les produits .
Author(s) -
Chao ChiChur,
Laffargue JeanPierre,
Sgro Pasquale M.
Publication year - 2012
Publication title -
canadian journal of economics/revue canadienne d'économique
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.773
H-Index - 69
eISSN - 1540-5982
pISSN - 0008-4085
DOI - 10.1111/j.1540-5982.2012.01723.x
Subject(s) - tariff , consumption (sociology) , revenue , economics , consumption tax , welfare , small open economy , government (linguistics) , pollution , product (mathematics) , tax revenue , natural resource economics , tax policy , international economics , business , public economics , tax reform , ad valorem tax , macroeconomics , market economy , finance , ecology , social science , linguistics , philosophy , geometry , mathematics , sociology , biology , exchange rate
For a small open economy with consumption‐based pollution emissions, the first‐best optimal policy prescription is free trade along with a Pigouvian tax on emissions. Therefore, a package of coordinated tax reform by replacing tariffs with emission taxes can lower pollution emissions and increase market access and hence improve residents’ welfare and government revenue, as long as the initial tariffs are relatively high. Numerical simulations confirm the results obtained.