Theoretical and empirical aspects of policy failures due to subsidies are discussed in the context of international trade. A general classification of subsidies that cause environmental externalities is presented. The economic and environmental impacts of producer subsidies on international...

The study shows that trade could play a positive role in the diffusion of environment-friendly technologies around the world and is backed up by the five case studies on chemical-intensive agriculture, deforestation, global warming, acid rain, and overfishing.