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...

Differences in property rights create a motive for trade among otherwise identical regions. Two regions with identical technologies, endowments, and preferences will trade if one, the South, has ill-defined property rights on environmental resources. Trade with a region with well-defined...