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Trade Policy and Environmental Quality: The Case of Export Subsidies

Published online by Cambridge University Press:  15 September 2016

Susan Leetmaa ,
Barry Krissoff  and
Monika Hartmann
Susan Leetmaa
Affiliation:
Economic Research Service, USDA, Washington, D.C.
Barry Krissoff
Affiliation:
Economic Research Service, USDA, Washington, D.C.
Monika Hartmann
Affiliation:
Institute of Agricultural Development in Central and Eastern Europe, Germany
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Abstract

The United States and the European Union both employ export subsidies to stimulate wheat trade and to increase their competitiveness in world markets. The environmental consequences of these policies are being questioned. We stimulate reducing or removing export subsidies for wheat from the United States and the EU using a multicountry partial equilibrium model, and we analyze the impact of export subsidy policy reform on nitrogen fertilizer and other chemical use. Our findings indicate that the U.S. EEP program cannot be blamed for environmental degradation in terms of nitrate leaching, while EU wheat subsidies make only a small contribution to nitrate pollution.

Type
Articles
Information
Agricultural and Resource Economics Review , Volume 25 , Issue 2 , October 1996 , pp. 232 - 240
Copyright
Copyright © 1996 Northeastern Agricultural and Resource Economics Association 

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