2. Trade and the Environment
Opening up the economy to trade.
Markets, prices and competition.
Foreign markets.
Laws
3. The Role of Property Rights: Inflict detrimental effects
on the environment when some nations have poorly
defined property right or have not internalized their
externalities.
Pollution Havens and the Race to the Bottom:
Pollution levels can change in the pollution havens for
three different reasons: (1) the composition effect; (2) the
technique effect; or (3) the scale effect.
4. The Porter “Induced Innovation”
Hypothesis
The Porter hypothesis is valuable because it
reminds us that a particularly ingrained piece
of conventional wisdom is frequently wrong.
Innovation induced by environmental
regulation could simultaneously increase
productivity.
5. The Environmental Kuznets
Curve (EKC)
The notion that increasing income from trade
involves a self-correcting mechanism would
have a quite different meaning if part of that
correction involved exporting the pollution-
intensive industries to other countries.
6. Investor Protections: NAFTA´s
Chapter 11
NAFTA allows corporations to sue the national
government of a NAFTA country in secret
arbitration tribunals if they feel that a
regulation or government decision adversely
affects their investment in a way that violates
these new NAFTA rights
7. Trade Rules under GATT and the
WTO
That agreement provided an international
forum for encouraging and reducing tariffs.
These rules examine, for example such things
as “differential treatment”.
A disputed environmental action that
discriminates against goods from another
country is deemed differential treatment and is
unacceptable.
