The authors suggest a new approach assessing carbon taxes on imports to address the concerns from high-income countries about the effect of taxes on competition without damaging trade from developing countries.
In this paper Arvind Subramanian and co-authors investigate the differential effects of cooperatitve policy action on climate change and find that one size doesn't fit all. Policy instruments should distinguish between low- and high-carbon countries to avoid serious trade consequences.
Despite six decades of trade liberalization, trade policies in rich countries still discriminate against the exports of the world’s poorest countries. Much remains to be done to achieve the goal of meaningful market access for the poorest countries, including reformed rules of origin that facilitate rather than inhibit trade.
Criss-Crossing Globalization: Uphill Flows of Skill-Intensive Goods and Foreign Direct Investment - Working Paper 176
What happens when capital and sophisticated goods flow uphill, from poorer to richer countries? With a new dataset of foreign direct investment and a measure of the sophistication of exports, CGD senior fellow Arvind Subramanian and his co-author Aaditya Mattoo find that developing countries sending goods and services uphill experience economic growth and other development benefits.
Visiting fellow Nora Lustig examines the policy dilemmas rising food prices force on developing countries. Letting prices adjust can generate inflationary pressure while efforts to stabilize domestic prices often exacerbate global price increases; during the recent food price crisis, many countries chose instead to shift the burden back to international markets.