Trade Liberalization in General Equilibrium: Intertemporal and Inter-industry Effects
Abstract
A computable general equilibrium model is used to examine effects of removing U.S. tariff and non-tariff barriers to trade. The model differs from traditional disaggregated trade models in its attention to intertemporal decision-making, adjustment dynamics, and international capital mobility. Unilateral elimination of tariffs would reduce the welfare of U.S. households by 0.4 percent. Elimination of quantitative restrictions, in contrast, would increase U.S. welfare by 1.1 percent. The international cross-ownership of capital associated with internationally mobile capital significantly influences the distribution of capital gains and losses from trade liberalization. Disregarding cross-ownership leads to understatement of the domestic welfare losses from tariff removal and overstatement of the domestic welfare gains from eliminating quantitative restrictions.Download Info
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Bibliographic Info
Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.
Volume (Year): 25 (1992)
Issue (Month): 2 (May)
Pages: 253-80
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Related research
Keywords:Other versions of this item:
- Goulder, Lawrence H. & Eichengreen, Barry, 1989. "Trade Liberalization in General Equilibrium: Intertemporal and Inter-Industry Effects," Department of Economics, Working Paper Series qt0ws6559g, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Lawrence H. Goulder and Barry Eichengreen., 1989. "Trade Liberalization in General Equilibrium: Intertemporal and Inter-Industry Effects," Economics Working Papers 89-110, University of California at Berkeley.
- Lawrence H. Goulder & Barry Eichengreen, 1989. "Trade Liberalization in General Equilibrium: Intertemporal and Inter-Industry Effects," NBER Working Papers 2965, National Bureau of Economic Research, Inc.
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Walmsley, Terrie, 1998.
"Long Run Simulations With GTAP: Illustrative Results from APEC Trade Liberalisation,"
GTAP Technical Papers
312, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
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