The paper represents a new reading of the traditional Ricardian theory of comparative advantages to tackle current challenges of environmental and climate policy. In the style of David Ricardo, it demonstrates that international trade is a positive-sum game in a twogoods, two-countries world...

Differences in environmental regulation between rich and poor countries have caused a geographical relocation of polluting industry from the former to the latter. In several cases the reduction in domestic emissions is at least partly compensated by an increase in trans-boundary pollution which...