Trade and Development Blog

Just as we move onto the topic of international public goods and multilateral negotiations on trade and climate, a significant negotiating meeting is happening in Cancun Mexico (this follows on the heels of a meeting in Copenhagen a few years ago). What's being discussed and negotiated is how to put in place a global cap and trade agreement to limit global emissions that are believed to contribute to global warming. Under a cap and trade system a global cap on the amount of emissions (measured say in billions of tons of CO2 gases) is set and tradable emission permits are set equal to that amount. Loosely, if you want no more than say X billion tons of CO2 gas emissions in a year only X billion permits are issued. Each country is allocated a quota of permits, and these are allocated within each country and are made tradable on international markets. Then if say a coal-fired electricity generator has only enough permits for 1000 tons of CO2 gas but it wants to emit 1500 it would h...

We've spent plenty of time in class discussing farm subsidies (and export subsidies) and the political economy of their support. Mind you that the following is an opinion piece (by a strongly opinionated Libertarian) and not a news article, but still it had some interesting quotes and numbers: Al Gore's Alcohol Problem: Admits Ethanol Subsidies a Mistake - The Daily Beast : "Last week, Al Gore finally admitted the obvious. The former vice president (and winner of the Nobel Peace Prize) who promoted ethanol in his Oscar-winning film, “An Inconvenient Truth,” said that corn ethanol was a “mistake.” He went further, saying that he supported ethanol production because the first presidential primary is in Iowa, which produces more ethanol than any other state: “I had a certain fondness for the farmers in the state of Iowa because I was about to run for president,' he said. Gore also said that the “massive subsidies” given to ethanol are not “good policy.” From the same ar...