In our analytical general equilibrium model where two polluting inputs can be substitutes or complements in production, we study the effects of a tax on one pollutant in two cases: one where both pollutants face taxes and the second where the other pollutant is subject to a permit policy. In...

This paper investigates the impact of foreign trade on China’s pollution emissions using an input-output model. General y speaking, as exports are more pollution-intensive than imports, foreign trade helps reduce China’s emissions. Given the huge surplus of trade in goods and declines in the...