This paper provides a theoretical framework that can explain the empirical observation that foreign banks from industrialized countries tend to increase their involvement in emerging markets in periods of market instability. In this model, domestic banks have (through past lending operations)...

We investigate in a horizontal product differentiation model with North-South trade the implications of a home bias in consumers' demand for labelled goods. We compare mutual recognition and international harmonisation of ecological labels with respect to firms' profits and welfare. Northern...

In economies with perfect competition, environmental tax rates should be set equal to the equilibrium marginal damage. There are two basic reasons to depart from this first best rule: incomplete competition and the possibility of using environmental policy as a strategic trade instrument in open...