Modelling a new economic, environmental and political connectivity: the dynamics of Japan - EU trade

The landscape of international trade has undergone substantial changes in the past 20 years. Due to a standstill of the WTO Doha Round negotiations, the number of preferential trade agreements has surged. Furthermore, global value chains have grown increasingly complex, leading to new interdependencies between countries and regions. There are also new norms for trade, exemplified by growing expectations that trade policy contributes to sustainable development. Within this context, this thesis analyses the current economic, environmental and political dynamics of Japan – EU trade. This research project employs a mixed-methods approach combining economics and area studies, as well as a combination of quantitative and qualitative research methods. The main topics of analysis are the following: (1) A qualitative analysis that compares Japan and the EU’s public discourse about their shared commitment to liberal, free trade with the discourse in domestic Japanese policy documents. (2) A quantitative assessment with a Computable General Equilibrium (CGE) model of the EU – Japan Economic Partnership Agreement that takes into account the reality that some businesses will not be able to use the benefits of this agreement. (3) A qualitative exploration of the Japanese domestic landscape related to carbon pricing policy and the EU’s Carbon Border Adjustment Mechanism (CBAM). (4) A CGE analysis of the environmental-economic impact of three possible Japanese responses to the EU’s CBAM.