The Economic Significance of Pollution Control and Worker Safety Costs for World Copper Trade

Abstract

What is the best relationship between strict environmental regulation in the industrialized countries and higher levels of global pollution? According to economic theory, the answer will depend upom cost parameters, and particularily upom the degree of responsiveness of production costs as they increase with control requirements. If, for example, an additional 10% increase in pollution control in a developed country causes a 20% increase in pollution control costs, then there will be an increase in global pollution if the developed country raises its standard. The process involves increasing the levels of uncontrolled production in developing countries, and increased export of copper and copper-intensive products to developed countries. In the paper, theoretical disscussion is complemented by a comparison of sulfur emission control, water pollution control, and worker safety practices at three pit mines and three smelters in Mexico and the United States. At the most advanced levels, environmental protection and worker safety practices cost $.15 per pound of product copper. This situation creates severe difficulties for controlling global pollution levels, and for international competition in copper trade. The paper concludes with a review of national and international responses to the problem.