Discussion Paper No.1209
Title:Renewable Resources, Environmental Pollution, and International Migration
Authors:KENJI KONDOH
Abstract:
We develop a two-country model with two industries: the smokestack
manufacturing industry, which generates pollution, and the transboundary
renewable resource industry. With no trade, migration occurs from the
foreign country, with lower manufacturing productivity, to the home country.
If the gap in pollution abatement technology, which is superior in the home
country, dominates the productivity gap, both countries gain from migration.
Under a free trade equilibrium, we also show that if the marginal harvest of
the resource industry is lower (higher) than marginal damage of
manufacturing in the home (foreign) country, migration still causes positive
effects on the stock of renewable resources, which should improve both
countries’ welfare.
JEL Classification Number(s): F22, Q20
Number of Figures: 0 Number of Tables: 0
Date: 04 November 2003.