Copeland and Taylor (1999) consider the effects of free trade on environmental quality by allowing
environmental pollution in industrial sector. 1 assume that agricultural production also harms to the environmental
quality through habitat ωr巧ingcapacity destruction. The model offer's two arguments.
First， if a small open economy specializes in agricultural sector in steady state， then the country's
steady-state environmental quality and economic welfare may lower under仕eetrade than in autarky.
Second， if a small open economy specialized in industrial sector in steady state， then the country's
steady-state environmental quality may be higher under仕eetrade than in autarky.
