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The Effects of NAFTA on the Environment

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  • Robert K. Kaufmann
  • Peter Pauly
  • Julie Sweitzer

Abstract

This paper reviews the impacts of NAFTA on the environment. Discussion focuses on the degree to which economic conditions in Canada, Mexico, and United States are consistent with the assumptions on which the benefits of free trade are based. Specifically, we discuss how NAFTA may exacerbate or alleviate the environmental impacts of economic activity via environmental externalities, the rate and efficiency of resource extraction, increased income, increased trade and transportation, and harmonizing environmental policy among nations at different levels of economic development. Because of difficulties in comparing different types of environmental impacts, we do not offer a conclusion about the overall effect of NAFTA on the environment, positive or negative. Rather, we argue that NAFTA must preserve the rights of all affected parties to intervene so that the costs and benefits associated with a particular project that arises out of increased trade can be evaluated on a case by case basis in the same imperfect way that such issues are addressed within the confines of a single nation.

Suggested Citation

  • Robert K. Kaufmann & Peter Pauly & Julie Sweitzer, 1993. "The Effects of NAFTA on the Environment," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 217-240.
    • Handle: RePEc:aen:journl:1993v14-03-a10
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    References listed on IDEAS

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    1. Gerard Adams, F. & Alanis, Mario & del Rio, Abel Beltran, 1992. "The Mexico-United States free trade and investment area proposal: A macroeconometric evaluation of impacts on Mexico," Journal of Policy Modeling, Elsevier, vol. 14(1), pages 99-119, February.
    2. Drusilla K. Brown & Alan V. Deardorff & Robert M. Stern, 2011. "A North American Free Trade Agreement: Analytical Issues and a Computational Assessment," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 40, pages 557-575, World Scientific Publishing Co. Pte. Ltd..
    3. Cleveland, Cutler J., 1993. "An exploration of alternative measures of natural resource scarcity: the case of petroleum resources in the U.S," Ecological Economics, Elsevier, vol. 7(2), pages 123-157, April.
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    Cited by:

    1. Jayadevappa, Ravishankar & Chhatre, Sumedha, 2000. "International trade and environmental quality: a survey," Ecological Economics, Elsevier, vol. 32(2), pages 175-194, February.
    2. William D. Nordhaus, 1994. "Locational Competition and the Environment: Should Countries Harmonize Their Environmental Policies?," Cowles Foundation Discussion Papers 1079, Cowles Foundation for Research in Economics, Yale University.
    3. Apergis, Nicholas & Payne, James E., 2020. "NAFTA and the convergence of CO2 emissions intensity and its determinants," International Economics, Elsevier, vol. 161(C), pages 1-9.
    4. Adam B. Jaffe et al., 1995. "Environmental Regulation and the Competitiveness of U.S. Manufacturing: What Does the Evidence Tell Us?," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 132-163, March.
    5. Per G. Fredriksson, 1999. "The Political Economy of Trade Liberalization and Environmental Policy," Southern Economic Journal, John Wiley & Sons, vol. 65(3), pages 513-525, January.

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    • F0 - International Economics - - General

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