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Trade Liberalization and Culture

Author

Listed:
  • Steven Suranovic

    (Department of Economics, The George Washington University, 1957 E St. N.W. Suite 502, Washington, DC 20052, USA)

  • Robert Winthrop

    (US Department of the Interior, Bureau of Land Management, Washington, DC, USA)

Abstract

This paper addresses the effect of international trade on cultural outcomes from both economic and anthropological perspectives. Definitions of culture are informed by anthropology and then incorporated into a standard economic trade models in two distinct ways. In the “cultural affinity from work” model, workers receive a non-pecuniary cultural benefit from work in a particular industry. In the “cultural externality” model, consumers of a product receive utility from other consumer’s consumption of a domestic good. We show that resistance to change due to cultural concerns can reduce the national benefits from trade liberalization. Complete movements to free trade will have a positive national welfare impact in the cultural affinity case, whereas it may lower national welfare in the cultural externality case. We also show that a loss of cultural benefits is more likely to occur when culture is an externality.

Suggested Citation

  • Steven Suranovic & Robert Winthrop, 2014. "Trade Liberalization and Culture," Global Economy Journal (GEJ), World Scientific Publishing Co. Pte. Ltd., vol. 14(1), pages 57-78, April.
  • Handle: RePEc:wsi:gejxxx:v:14:y:2014:i:01:n:gej-2013-0047
    DOI: 10.1515/GEJ-2013-0047
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    References listed on IDEAS

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    5. Thurow, Lester C, 1978. "Psychic Income: Useful or Useless?," American Economic Review, American Economic Association, vol. 68(2), pages 142-145, May.
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    Cited by:

    1. Winthrop, Robert H., 2014. "The strange case of cultural services: Limits of the ecosystem services paradigm," Ecological Economics, Elsevier, vol. 108(C), pages 208-214.

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