Howard F. Chang

Any Non-welfarist Method of Policy Assessment Violates the Pareto Principle: A Comment

In a recent article, Kaplow and Shavell (2001) claim that any methodof policy assessment that is not purely welfarist violates the Pareto prin-ciple. Kaplow and Shavell use the term “welfarism” to describe notionsof social welfare “under which assessment of policies depends exclusivelyon their effects on individuals’ utilities” (p. 281). A welfarist policy as-sessment uses a social welfare function from the set

Liberalized Immigration as Free Trade: Economic Welfare and the Optimal Immigration Policy

This paper describes the immigartion policy that would naximize the welfare of natives. Trade principles indicate that the United States should eliminate its immigration quotas and other nontariff protectionist bassiers and use immigration tariffs instead.

The Effect of Allowing Pollution Offsets with Imperfect Enforcement

Public policies for pollution control, including climate change policies, sometimes allow polluters in one sector subject to an emissions cap to offset excessive emissions in that sector with pollution abatement in another sector. The government may often find it more costly to verify offset claims than to verify compliance with emissions caps. Concerns about such difficulties in enforcement may lead regulators to restrict the use of offsets. In this paper, we demonstrate that allowing offsets may increase pollution abatement and reduce illegal pollution, even if the government has a fixed enforcement budget. We explore the circumstances that may make allowing pollution offsets an attractive option when enforcement is costly.

Implications of Globalization and Trade for Water Quality in Transboundary Rivers

Increases in international trade have a variety of effects on the environment through the location, scale, and techniques of production. International trade may also have special effects on transboundary resources, such as international rivers as trade provides greater opportunities for policy coordination between trading partners who share a resource. This chapter discusses several mechanisms by which trade may facilitate coordination: trade may provide opportunities for linkage between environmental and trade concessions, facilitate implicit side payments, grant countries direct leverage over other countries’ production, and instill a perception of shared goals between countries. An empirical section reports a test of the effects of globalization (interpreted in the regression equations as overall trade) and trade specifically between countries sharing a natural resource. The United Nation’s Global Environmental Monitoring System (GEMS) provides data on water quality at river monitoring stations around the world. We have coded these stations to indicate whether the rivers cross international borders, and if so, which countries share the river. We then merged these data with information on bilateral trade between upstream and downstream countries and characteristics of these countries such as their income levels and trade openness. The results suggest that water pollution is lower in rivers shared between countries with more trade; supporting the hypothesis that trade promotes coordination of environmental policies.

Law and economics of immigration

This volume compiles influential and diverse readings on the timely subject of immigration. This collection includes work published by leading economists, as well as a number of important contributions made by influential legal scholars, with a focus on economic issues that are salient in debates over immigration policy. Professor Chang’s introduction not only explains the contribution that each reading makes to our understanding of immigration, but also surveys the literature more broadly, putting the selected readings in context.