Sebastien Dessus

Is There a Trade-off Between Trade Liberalization and Pollution Abatement?: A Computable General Equilibrium Assessment Applied to Costa Rica

Abstract Recent literature elucidates important linkages between trade and environment, emphasizing on the possible reconciliation between trade liberalization and emission abatement policies. Facing the lack of robustness of qualitative results shown in theoretical work, this paper attempts a quantitative assessment of the interdependencies of these policies. A recursive dynamic CGE model for Costa Rica shows that environmental taxes marginally reduce growth yet allow a sharp decrease of emissions, and that outward orientation alone promotes growth, but induces a risk of specialization in dirty activities. Free trade combined with appropriate effluent taxes enhances factor reallocation towards competitive industries, and hence growth, while significantly abating emissions.

Human Capital and Growth: The Recovered Role of Education Systems

Recent empirical studies qustionthe conventional wisdom on the importance of education for growth. This result comes partly from the fact that international differences in the quality of the educational system--defined by its capacity to produce one marginal unit of productive human capital--are not taken into account. The author estimates that neo-classical growth models on panel data in which the elasticity of human capital depends stochastically on different characteristics of the educational system. Several of these characteristics explain the quality differences such as the educational infrastructures, the initial endowment of human capital, and the ability to distribute equally educational services withtin the population.

Trade integration, environmental degradation, and public health in Chile: assessing the linkages

We use an empirical simulation model to examine links between trade integration, pollution, and public health in Chile. We synthesize economic, engineering, and health data to elucidate this complex relationship and support more coherent policy. Trade integration scenarios examined include Chiles accession to the NAFTA, MERCOSUR, and unilateral opening to world markets. The latter scenario induces substantial worsening of pollution, partly because it facilitates access to cheaper and dirty energy, and has a significant negative effect on urban morbidity and mortality. Damages caused by rising morbidity and mortality are of similar magnitude and substantial. Emissions of small particulates, SO2, and NO2, have the strongest impact on local mortality and morbidity. These three pollutants appear to be complementary in economic activity. Unilateral trade integration combined with a tax on small particulates brings welfare gains, which are 16 per cent higher than those obtained under unilateral trade reform alone.

The trade and environment nexus in Mexican agriculture. A general equilibrium analysis

This paper analyzes linkages between growth, trade and the environment in Mexican agriculture with an empirical economy-wide model. The investigation considers trade liberalization, environmental policy reform, and their coordination. The analysis decomposes the change in pollution emission induced by changes in the sectoral composition of production, effects of technology on emission intensity, and aggregate scale effects. Outward orientation alone induces a contraction of aggregate agricultural output, but promotes growth and pollution in some agricultural sectors. Overall, free trade does not induce wholesale specialization in dirty agricultural activities. Environmental taxes on pollution emitted in agricultural sectors have a moderate negative impact on agricultural output, except for the tax on water-borne toxic chemicals. More liberal trade combined with targeted effluent taxes can achieve significant environmental mitigation and efficiency gains, but with the implication of a contraction of most agricultural sectors.

General Equilibrium Modelling of Trade and the Environment

The environmental impacts of economic activity have become an increasingly urgent concern in both OECD Member countries, as well as in non-Member countries. Research in this area is still in its infancy, and the data required to buttress analytical studies is still sparse. This paper describes the base model specification for a series of six country case studies undertaken at the OECD Development Centre to analyse the links between growth and emissions, and emissions and trade instruments. The model attempts to capture some of the key features relating to environmental emissions. These features include: a) linking emissions to the consumption of polluting inputs (as opposed to output); b) including emissions generated by final demand consumption; c) integrating substitutability between polluting and non-polluting inputs (including capital and labour); d) capturing important dynamic effects such as capital accumulation, population growth, productivity and technological ... L’interet porte aux consequences de l’activite economique sur l’environnement s’est considerablement accru, aussi bien dans les pays Membres de l’OCDE que dans les pays non membres. La recherche dans ce domaine est encore balbutiante, et les donnees necessaires a l’analyse empirique encore trop rares. Ce document decrit les specifications du modele utilise pour les six etudes de cas entreprises au Centre de Developpement de l’OCDE, afin d’etudier d’une part les liens entre la croissance et la pollution et, d’autre part, les liens entre la pollution et les politiques commerciales. Le modele tend a decrire plusieurs phenomenes cles de la relation entre environnement et activite economique. Ainsi, le modele a) relie les emissions de pollution a la consommation de produits polluants (et non a la production) ; b) inclut les emissions provenant de la demande finale ; c) integre une possibilite de substitution entre intrants polluants et non polluants (comme le capital ou le travail) ; d) ...

Trade Integration with Europe, Export Diversification and Economic Growth in Egypt

Egypt needs to diversify exports further in order to emerge from its isolation and to draw the maximum advantage from the growth potential offered by trade globalization. To what extent does the bilateral free trade agreement with the European Union encourage the transition from a rentier economy to one of export-led growth? This paper uses a dynamic, calculable, general equilibrium model to assess different scenarios for the Egyptian economy to the year 2010. The authors reach the conclusion that the preferential trade agreement with Europe should facilitate the transition if the increase in trade results in higher Egyptian productivity through technology transfer and pressure from competition. Under these conditions, the agreement would seem to have a similar impact to that which could be expected from unilateral Egyptian trade liberalization, affecting all the country’s trading partners.

Le rôle du capital public dans la croissance des pays en développement au cours des années 80

Cette etude analyse les liens entre la croissance et l’investissement public au cours des annees 80 a l’aide d’un modele econometrique d’equations simultanees, estime sur un echantillon de 28 pays en developpement sur onze ans (1981-91). Ce modele decrit les determinants de la croissance et de l’investissement public et prive. Le capital public est un facteur positif de la croissance, tout comme le capital humain ou le capital productif prive. Cependant, la formation du stock de capital public a genere des effets d’eviction, au detriment de la constitution du stock de capital productif prive. Nos resultats suggerent qu’un nombre important des pays de l’echantillon s’est eloigne d’une situation optimale pour la croissance de partage du capital disponible entre les secteurs publics et prives ...

Exploring Lebanon's Growth Prospects

This paper attempts to identify Lebanons greatest constraints to economic growth, following a growth diagnosis approach. It concludes that fiscal imbalances and barriers to entry are most binding on long-term growth. Macroeconomic imbalances and related perceived risks affect the nature of investment decisions in Lebanon, in favor of liquid instruments rather than longer-term productive investments. Further, many barriers to entry discourage agents from investing in a number of markets: legal impediments to competition, corruption, and a set of fiscal incentives favoring the allocation of resources to non-tradable sectors, where potential demand and investment opportunities are scarcer. In turn, using a steady-state computable general equilibrium model, the paper assesses the long-term growth impact of a selected set of policy reforms envisaged to lift such constraints. Results suggest that 1 to 2 percentage points of additional GDP growth per year could be gained through public expenditure reform, greater domestic competition, and tax harmonization.

Total Factor Productivity and Outward Orientation in Taiwan: What is the Nature of the Relationship?

Recent applied literature finds a correlation between total factor productivity (TFP) growth and increased outward orientation, but the nature of the theoretical relationship remains controversial. In this paper, we test econometrically several specifications using time series for Taiwan to elucidate the question. We find strong support for the view that imports of technology, in a context of decreasing returns to imitation, and the removal of domestic distortions, through its impact on the labor markets allocative efficiency, have played a major role in Taiwans TFP growth. Conversely, export promotion, per se, did not affect TFP growth significantly, but through its indirect contribution to financing imports.

Trade Integration with Europe and Labor Reallocation in the Southern Mediterranean Countries: The Case of Egypt

This paper looks at the implications of the Euro-Mediterranean partnership agreement on labor and wages in Egypt, using a dynamic CGE model, which takes into account the labor market segmentation. Our results suggest that trade liberalization bears the risk of promoting the use of capital-intensive technology, thus reducing the employment content of growth. Employment policies that increase the mobility between the segments of the labor market and wage flexibility could enhance the job creation effect induced by trade liberalization. Employment and trade policies are also complementary in political terms, by alleviating the losses borne by the insiders following the entry of new workers into the labor market.