Natural Resources Research Articles
An ecosystem services penalty system for evaluating international trade proposals
Document Type
Article
Publication Date
8-25-2022
Journal Title
Journal of Environmental Economics and Policy
ISSN
Print: 2160-6544 Electronic: 2160-6552
Keywords
Ecosystem services, international trade, dispute resolution, social welfare impacts
Disciplines
Agricultural and Resource Economics | Environmental Studies
Abstract
The World Trade Organization is not explicitly in the business of environmental protection, but through recent initiatives it has sought to better understand the complex relationship between trade and the environment and its role in promoting sustainable trade growth. In line with these initiatives, this paper discusses ways it might explicitly consider ecosystem services impacts when ruling on trade disputes so as to internalise ecosystem services externalities. We propose a change to existing methods of settling trade disputes to include a comparison between the traditional gains from trade and the multilateral change in ecosystem services associated with trade by incorporating a penalty system into the dispute resolution process. If this comparison assesses damages to ecosystem services to exceed the gains from trade then the penalty system suggests trade should not be allowed to take place. This penalty system in turn can create an incentive for exporting countries to reduce their impacts on ecosystem services to facilitate trade.
Recommended Citation
Cook, D C,
Fraser, R W,
and
Haddock-Fraser, J.
(2022), An ecosystem services penalty system for evaluating international trade proposals. Journal of Environmental Economics and Policy, 12 (3), 249-259.
https://library.dpird.wa.gov.au/nrm_research/1
