Caroline Saunders (email: email@example.com) is a Professor and Anita Wreford is a Research Associate in the Agribusiness and Economics Research Unit (AERU) at Lincoln University, PO Box 84, Lincoln, Canterbury, New Zealand. Selim Cagatay is an Associate Professor in the Department of Economics at Hacettepe Universitesi, Turkey.
Trade liberalisation and greenhouse gas emissions: the case of dairying in the European Union and New Zealand*
Article first published online: 1 NOV 2006
Australian Journal of Agricultural and Resource Economics
Volume 50, Issue 4, pages 538–555, December 2006
How to Cite
Saunders, C., Wreford, A. and Cagatay, S. (2006), Trade liberalisation and greenhouse gas emissions: the case of dairying in the European Union and New Zealand. Australian Journal of Agricultural and Resource Economics, 50: 538–555. doi: 10.1111/j.1467-8489.2006.00343.x
The authors would like to acknowledge the comments from three anonymous referees.
- Issue published online: 1 NOV 2006
- Article first published online: 1 NOV 2006
- agricultural production systems;
- greenhouse gas emissions;
- trade liberalisation
The link between trade and the environment has aroused considerable interest both in terms of the impact of trade liberalisation on the environment, and also the impact of environmental policy on production and trade. Of key environmental concern at present is global warming and its association with greenhouse gas emissions. Agriculture is a sector of the economy that both contributes to, and will be affected by, climate change. This paper models the impact of agricultural trade liberalisation on greenhouse gas emissions from agriculture around the world, focusing particularly on the effects on New Zealand, a small economy highly dependent on agricultural trade. A partial equilibrium agricultural multicountry, multicommodity trade model is used for the analysis, extended to include physical production systems and their greenhouse gas emissions. Two simulations are performed: removal of agricultural policies in the EU and in all OECD countries. The results indicate that although producer returns in New Zealand increase, greenhouse gas emissions also increase significantly. EU producers face lower returns but also lower greenhouse gas emissions.