Abrego, Lisandro (2000) Applied general equilibrium analysis of trade and environmental issues. PhD thesis, University of Warwick.

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Abstract

This thesis uses general-equilibrium numerical-simulation techniques to analyse trade
and environmental issues. It tries to take applied general equilibrium modelling in
these areas beyond their traditional confines in a number of ways. These include
endogenous incorporation of international capital flows into trade models, decomposition
of observed economic outcomes, and computation of bargaining solutions and
non-cooperative equilibria. Chapter 1 analyses the welfare, income distribution and
macroeconomic implications of trade liberalisation and increased indirect taxation
in El Salvador. It is found that these policies have little effect on welfare and income
distribution, but a significant impact on macroeconomic aggregates. Chapter 2
examines trade liberalisation when foreign direct investment (FDI) flows and international
capital income taxation are present, using data for Costa Rica. The main
finding is that, once FDI flows and its taxation are taken into consideration, trade
liberalisation can hurt a small open economy, whose optimal policy is no longer free
trade but a combination of taxes and subsidies on imports. Chapter 3 deals with the
decomposition into trade and technology constituents parts of recent increased wage
inequality in the UK. It analyses how decomposition is affected by the way in which
labour markets are modelled. It is found that when labour markets are perfectly
competitive, the main force behind increased wage inequality is technological change,
with trade playing only a small role; but when labour market inflexibilities are taken
into account, any of the two factors considered can become dominant, depending on
the parameter specification used in the model. Chapter 4 examines the incentives
for developing-country participation in possible future negotiation on trade and the
environment, assumed to break down on North-South lines. It finds that developing
countries will do better if they negotiate jointly on trade and environmental policies
than if they negotiate over trade policy only. However, negotiations accompanied
with side payments of cash will be even better for them. Finally, Chapter 5 analyses
the role of adaptation responses to damage from externalities. Using a hierarchy of
models calibrated to UK data, we compare internalisation effects in the presence of
these responses with a case where they are absent. We find that taking account of
adaptation responses significantly reduces the level of full-internalisation taxes and
the associated welfare gains from externality correction.

Item Type:	Thesis or Dissertation (PhD)
Subjects:	H Social Sciences > HB Economic Theory
Library of Congress Subject Headings (LCSH):	Equilibrium (Economics), Commerce -- Econometric models, Capital movements
Official Date:	March 2000
Dates:	Date Event March 2000 Submitted
Institution:	University of Warwick
Theses Department:	Department of Economics
Thesis Type:	PhD
Publication Status:	Unpublished
Supervisor(s)/Advisor:	Perroni, Carlo ; Whalley, John
Sponsors:	Ford Foundation ; Institute for International Education
Extent:	xiv, 178 leaves
Language:	eng

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