Bard Harstad is a Professor in Economics at the University of Oslo.

He will present his paper “Trade, Trees and Contingent Trade Agreements”

Abstract

Free trade is often criticized because it can cause resource depletion, such as deforestation in the tropics. The purpose of this paper is to explore how trade agreements can motivate environmental conservation. I Örst present a model whereby the government in the South (S) expands its production capacity. Because this expansion may lead to deforestation, the North (N) may be harmed. After establishing negative relationships between trade and conservation, for FTAs and PTAs, I show that all negative results are reversed if countries can negotiate a contingent trade agreement (CTA), where a preliminary tari§ (i.e., unless it is renegotiated) can be contingent on the forest cover. The results indicate that the policy proposal in a 2020 nonpaper by Franceís and the Netherlands can be implemented effectively.

Please email gri.events@lse.ac.uk  to request the Zoom joining details for this workshop by 5pm on Tuesday, 22nd February 2022.

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