To curb climate change, existing literature has called for meat industry scale-downs. Meanwhile, Sweden—among other Western countries—has pronounced objectives to increase its meat exports. Not only to increase farm incomes but also to reduce overall GHG emissions from agriculture. The motivation is that Swedish farmers use more environmentally friendly production practices compared to farmers in other countries. Expected Results: This paper explores this proposition by applying a GE framework showcasing theoretically the importance of ‘environmental comparative advantage’, implying that the net environmental effects of increasing production in a sector in which a country has an absolute environmental advantage are not necessarily positive. We demonstrate quantitative results by calibrating a GE model with food and non-food goods to Swedish conditions, open up for trade with the rest of the world, and study the effects on net GHG emissions from subsidising the Swedish beef sector. The results may guide policy-makers in small open economies regarding which sectors to promote to contribute to climate change mitigation.

Informations pratiques