Social, Economic and Environmental Impact Assessment of Environmental Policies under Regional Economic Integration in East Asia

Regional economic integration in East Asia could promote sustainable development through generating higher incomes on the one hand, but equally it could cause environmental problems and could harm equity in the region. Development of appropriate environmental policies that can both mitigate negative impacts and enhance positive impacts of regional economic integration is thus an imperative to promote sustainable development in this region. This research aims to (i) develop an analytical tool to conduct sustainable development policy impact assessment, which is defined in this paper as an assessment of policy impacts on economic, environmental and poverty indicators, and (ii) conduct sustainable development policy impact assessment, in order to provide policy implications useful for such policy development. This research developed a basic tool to conduct sustainable development policy impact assessment, based on the GTAP-E model. The assessment results demonstrate the possibility of environmental policies to achieve economic development, environmental protection, and poverty reduction simultaneously, although the results could be over-optimistic due to potential underestimation of policy costs and inability of the model in directly linking tax revenue and government expenditure.