Trade and the environment: Economic and environmental impacts of global dairy trade liberalisation
This paper presents on a partial equilibrium model of international trade in dairy products that has been extended to include physical dairy production systems and their effect on water quality. This combined model, LTEM (Lincoln Trade and Environment Model), is then used to simulate the effects of liberalisation policies on trade flows, dairy production systems and groundwater nitrate levels across different countries. The results show expected variation in price and production impacts, but also unequal changes in groundwater quality between and within countries. More specifically, whilst liberalisation lowers dairy production in the EU and reduces the EU nitrate pollution slightly, the balancing production increases elsewhere lead to marginally higher pollution in other countries. This is of policy relevance given contemporary debates about the likely net environmental effect of further trade liberalisation.... [Show full abstract]
KeywordsLincoln Trade and Environment Model (LTEM); dairy industry; international trade; environmental effects; trade modelling; trade liberalization; Urban & Regional Planning
Fields of Research140201 Agricultural Economics; 140205 Environment and Resource Economics; 0502 Environmental Science and Management; 1205 Urban and Regional Planning; 1605 Policy and Administration
TypeReport (Technical Report)
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