The effect of global trade liberalization on toxic emissions in industry

The Effect of Global Trade Liberalization on Toxic Emissions in Industry. — Estimates of the output effects of the Uruguay Round and of a hypothetical agreement for free trade in manufactures are combined with estimates of the toxic intensity of industrial activities. Liberalization reduces global pollution moderately, by eliminating overproduction in protected “dirty” activities, and by reallocating “dirty” production from developing to developed countries. Parts of Asia, and the economies in transition, may become more polluted as a result of liberalization. Improvements in emission technology due to liberalization-induced income increases are estimated to be of second-order importance.