Thursday, June 24, 2010

Free trade externalities

Last weekend as I was pulling out weeds and being bitten repeatedly by mosquitoes, I contemplated on the possible externalities of free trade. Ignoring the problems with defining what is invasive and just accepting that soemthing is invasive if we start investing or spending dollars to get rid of it, the question then is whether the benefits of free trade outweigh these costs.

1. Undoubtedly some mosquito species are a direct result of trade e.g. tires:
Prior to 1985, the distribution of Aedes albopictus, the Asian tiger mosquito, was confined to Asia and many islands in the Pacific Ocean, including some of the Hawaiian Islands. Yet, in recent years the range of this mosquito has greatly expanded to include North and South America, Africa and Europe....The Asian tiger mosquito (ATM) was most likely introduced into North America through the importation of used tires from Japan or Taiwan.

2. Invasive plants as a direct result of trade, see here and here for instance. From the first link,
"... costs associated with a wider group of IS [invasive species] to be in the region of $143 billion per year." (for Oregon)

3. Some reallocation of labor to industries that deal with invasive species. This can either be a benefit (job creation) or a cost (job reallocation) if it hollows out other industries.

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