This paper explores the welfare consequences of international outsourcing in the presence of resulting environmental damage in a three-stage model of North-South trade. In stage 1, outsourcing firms in the North (e.g., United States [US] and Europe) cause environmental damage to the vendor...

This paper examines the effects of tourism in a dynamic model of trade on unemployment, capital accumulation and resident welfare. A tourism boom improves the terms of trade, increases labor employment, but lowers capital accumulation. The reduction in the capital stock depends on the degree of...