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specialization in economic activities with decreasing marginal returns, low
accumulation of human skills and low spill-over effects from the export sectors to the
rest of the economy, which is crucial for achieving balanced economic development
(Røpke, 1994).
World-systems theorists point out that today’s structure of trade relations
between different world regions is to a large extent a consequence of the
international division of labor, which has developed since the beginning of
colonization in the 16 th century (Wallerstein, 1974-1989). This international division of
labor lead to a restructuring of national economies in the South according to the
interests of the European colonial powers, transforming them into suppliers of raw
materials and cheap labor and thus creating dependency and underdevelopment for
the South (Frank, 1978). According to world-systems theory, this historical process
mainly determined the unequal distribution of economic power in today’s world
system.
2.2 Distribution of environmental goods and burdens
Supporters of a policy of further trade liberalization emphasize that free trade would –
in addition to economic advantages (see above) – also promote environmental
sustainability, as economic growth would increase tax revenues that would enable
governments to provide more financial resources for environmental protection. These
resources could then be used to satisfy the desire for a clean environment, which is
supposedly increasing with rising incomes (Bhagwati, 1993). In addition, the
institutional capacities to respond to environmental problems in general increase with
growth in income per capita (Dasgupta et al., 1995). Higher environmental pressures
stemming from the expansion of economic activities (“negative scale effect”) 3 would
be overcompensated by other effects.
First, it is assumed that especially in “underdeveloped” countries, rising
incomes will reduce the pressures that poverty places on the environment (Adams,
1997). Second, Southern countries would change their economic structures away
from activities in the resource-intensive primary sectors towards more
environmentally benign services (“positive structural effect”).
Finally, international trade would foster the transfer of clean technologies
(waste treatment, water and energy management) form North to South (“positive
technology effect”), which would significantly contribute to the amelioration of
environmental quality in “underdeveloped” regions (OECD, 2000).
However, the functioning of these mechanisms would presuppose effective
environmental policies. Such policies include full internalization of external
environmental costs according to the polluter-pays principle and the definition of
property rights for public goods. Given these preconditions, economic growth and
3
See, for example, OECD (1994) for a classification of the different environmental effects of trade
liberalization.
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