Commodity Modeling and Pricing: Methods for Analyzing Resource Market Behavior

PART Four

Environmental Resource Dynamics

The final part of this book deals with the trade and the environment, the linkage between the growing use of some commodities and the environment, and public policy. Ultimately, if policies and economic systems do not meet the fundamental needs of the members of our societies, they will fail. Therefore, these four chapters form a fitting conclusion to this volume.

Chapter 13 develops and simulates a trade-and-environment model for China. Given that country’s large size, very impressive recent growth, and its impact on world markets on the demand and supply side, the results are relevant to a wide range of interests. They show that trade is essential to helping China simultaneously achieve economic growth and a reduction in environmental pollution.

Chapter 14 complements Chapter 13. It provides a detailed study of China’s water crisis in terms of quantity and quality, and thus highlights the dilemma of environmental degradation that often accompanies rapid economic growth based on extractive and manufacturing industries. The author describes why the crisis developed to this point and the reasons behind its uneven geographic distribution. Its causation is also uneven among industries, with agriculture, not manufacturing, the biggest culprit. Although China has laws that potentially can deal effectively with water pollution, and technology to use water more efficiently is available in China, some administrative structures are not effective ...