Environment and Trade

At the beginning of the 1970s, a large number of developed countries have been concerned about the environmental degradation that has been affecting the planet, particularly the problems stemming from industrial pollution. For the last ten years, environmentalists and the trade policy community are engaged in a heated debate over the environmental consequences of trade liberalization. The debate was originally fueled by negotiations over the North American Free Trade Agreement and the Uruguay round of GATT negotiations, both of which occurred at a time when were concerned over global warming, species extinction and industrial pollution were rising.Recently, it has been intensified by the creation of the World Trade Organization (WTO) and proposals for future rounds of trade negotiations. The debate has often been unproductive. It has been hampered by the absence of a common language and also suffered from lack of recourse to economic theory and empirical evidence. The purposes of this book expose what we currently know about the environmental consequences of economic growth and international trade. We critically review both theory and empirical work to answer the basic questions.