Brian R. Copeland and M. Scott Taylor have coauthored numerous articles on trade and the environment in a variety of prominent journals. Copeland is Professor of Economics at the University of British Columbia. Taylor is Canada Research Chair in International, Energy, and Environmental Economics at the University of Calgary and a Research Associate at the National Bureau of Economic Research.

Preface vii
Chapter 1: The Trade and Environment Debate 1
1.1 Globalization and the Trade versus Environment Debate 1
1.2 Two Questions and a Preview of Our Answers 2
1.3 Our Method of Analysis 6
1.4 Plan of the Book 9
Chapter 2: Pollution in a Small Open Economy 12
2.1 Technology 16
2.2 Equilibrium along the Net and Potential Production Frontiers 26
2.3 Scale, Composition, and Technique Effects 45
2.4 Endogenous Pollution Policy 56
2.5 Conclusion 65
Chapter 3: Is There an Environmental Kuznets Curve? 67
3.1 Equilibrium Pollution and the Environmental Kuznets Curve 71
3.2 Sources of Growth 74
3.3 Income Effects 78
3.4 Threshold Effects 86
3.5 Increasing Returns to Abatement 97
3.6 Conclusion 104
Chapter 4: Trade Liberalization and Environmental Quality 107
4.1 Trade Frictions 110
4.2 Trade Liberalization with Rigid Pollution Policy 112
4.3 Trade Liberalization with Flexible Pollution Policy 123
4.4 The Political Economy Motive 132
4.5 Conclusion 139
Chapter 5: Pollution Haven Models of International Trade 142
5.1 Exogenous Policy Differences: Rigid Emission Intensities 146
5.2 Exogenous Policy Differences: Marketable Permit Systems 153
5.3 Endogenous Pollution Havens 158
5.4 Global Pollution and the World Composition Effect 164
5.5 Environmentally Friendly Pollution Havens 170
5.6 Northern and Southern Institutional Differences 171
5.7 Conclusion 183
Chapter 6: Factor Endowments, Policy Differences, and Pollution 187
6.1 Exogenous Policy: The Role of Factor Endowments 189
6.2 Endogenous Policy: Factor Endowments and Comparative Advantage 196
6.3 Correlated Characteristics: Being Rich and Capital Abundant 200
6.4 An Illustrative Example 206
6.5 Conclusion 213
Chapter 7: Is Free Trade Good for the Environment? An Empirical Assessment 215
7.1 Three Questions That Deserve an Answer 220
7.2 The Pollution Data 223
7.3 Deriving the Reduced Form 227
7.4 From Theory to Estimation 239
7.5 Empirical Results 250
7.6 Alternative Specifications and Theories 261
7.7 Conclusion 271
Chapter 8: Summary and Conclusions 275
8.1 Flexible Pollution Policy 275
8.2 Growth Is Not Trade 276
8.3 The Pollution Haven and Factor Endowments Hypotheses 277
8.4 Directions for Future Research 280
References 285
Index 291