It is well known that a consumer price-neutral reform of consumption taxes and import tariffs is welfare-improving. This paper shows that such price controls are inferior to quantity controls in terms of welfare improvement. The paper next turns to a comparison of different abatement strategies....

This paper demonstrates that the notion of environmental policy as a secondary trade barrier needs substantial modification when production pollution and consumption pollution coexist. The paper first focuses on local pollution and unilateral tax adjustments, showing that, under certain...