IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/352.html
   My bibliography  Save this paper

Voluntary export restraints and resource allocation in exporting countries

Author

Listed:
  • de Melo, Jaime
  • Winters, L. Alan

Abstract

Most literature on voluntary export restraints ( VERs ) analyzes the welfare costs of VERs to consumers in the importing country. The authors propose a method for measuring the effects of a VER on the productivity of factors employed in the exporting industry. Their model measures how a VER affects both revenues and efficiency in an exporting industry. They used the model to estimate the effects of the U.S. Orderly Marketing Agreement ( OMA ) on Korean producers of leather footwear ( 1977 - 81 ). Their econometric estimates indicate a limited ability to redirect sales to unrestricted markets and a sharp fall in the marginal revenue during the period the OMA was in effect. They found that the marginal revenue product of factors employed in leather footwear declined as much as 9 percent because of OMA. Based on illustrative counterfactual simulations, the authors show that a VER is likely to produce a welfare loss if demand is relatively elastic and supply is not.

Suggested Citation

  • de Melo, Jaime & Winters, L. Alan, 1990. "Voluntary export restraints and resource allocation in exporting countries," Policy Research Working Paper Series 352, The World Bank.
    • Handle: RePEc:wbk:wbrwps:352
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/1990/04/01/000009265_3960929042030/Rendered/PDF/multi0page.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Julio.J. Nogués & Andrzej Olechowski & L. Alan Winters, 2015. "The Extent of Nontariff Barriers to Industrial Countries' Imports," World Scientific Book Chapters, in: Non-Tariff Barriers, Regionalism and Poverty Essays in Applied International Trade Analysis, chapter 2, pages 29-47, World Scientific Publishing Co. Pte. Ltd..
    2. Hickman, Bert G. & Lau, Lawrence J., 1973. "Elasticities of substitution and export demands in a world trade model," European Economic Review, Elsevier, vol. 4(4), pages 347-380, December.
    3. Feenstra, Robert C., 1985. "Automobile prices and protection: The U.S.-Japan trade restraint," Journal of Policy Modeling, Elsevier, vol. 7(1), pages 49-68.
    4. Irene Trela & John Whalley, 1988. "Do Developing Countries Lose From the MFA?," NBER Working Papers 2618, National Bureau of Economic Research, Inc.
    5. Neary, J. P. & Roberts, K. W. S., 1980. "The theory of household behaviour under rationing," European Economic Review, Elsevier, vol. 13(1), pages 25-42, January.
    6. David G. Tarr, 2017. "Effects of Restraining Steel Exports from the Republic of Korea and Other Countries to the United States and the European Economic Community," World Scientific Book Chapters, in: Trade Policies for Development and Transition, chapter 25, pages 595-616, World Scientific Publishing Co. Pte. Ltd..
    7. Bark, Taeho & de Melo, Jaime, 1988. "Export Quota Allocations, Export Earnings, and Market Diversification," The World Bank Economic Review, World Bank, vol. 2(3), pages 341-348, September.
    8. Aigner, Dennis J. & Hsiao, Cheng & Kapteyn, Arie & Wansbeek, Tom, 1984. "Latent variable models in econometrics," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 23, pages 1321-1393, Elsevier.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Roberto A. De Santis, 2003. "Why exporting countries agree to voluntary export restraints: the oligopolistic power of the foreign supplier," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(3), pages 247-263, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Robert C. Feenstra, 1992. "How Costly Is Protectionism?," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 159-178, Summer.
    2. repec:dau:papers:123456789/6629 is not listed on IDEAS
    3. Robert C. Feenstra, 1989. "Auctioning U.S. Import Quotas, Foreign Response, and Alternative Policies," NBER Working Papers 2839, National Bureau of Economic Research, Inc.
    4. Erzan, Refik & Goto, Junichi & Holmes, Paula, 1989. "Effects of the multifibre arrangement on developing countries'trade : an empirical investigation," Policy Research Working Paper Series 297, The World Bank.
    5. Alessandro Balestrino & Lisa Grazzini & Annalisa Luporini, 2017. "A normative justification of compulsory education," Journal of Population Economics, Springer;European Society for Population Economics, vol. 30(2), pages 537-567, April.
    6. François Gardes, 2021. "Endogenous Prices in a Riemannian Geometry Framework," Post-Print halshs-03325414, HAL.
    7. Kan, Kamhon & Fu, Tsu-Tan, 1997. "Analysis of Housewives' Grocery Shopping Behavior in Taiwan: An Application of the Poisson Switching Regression," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 29(2), pages 397-407, December.
    8. Noriko Amano, 2018. "Nutrition Inequality: The Role of Prices, Income, and Preferences," 2018 Meeting Papers 453, Society for Economic Dynamics.
    9. Sebastian Edwards & Sweder van Wijnbergen, 1983. "The Welfare Effects of Trade and Capital Market Liberalization: Consequences of Different Sequencing Scenarios," NBER Working Papers 1245, National Bureau of Economic Research, Inc.
    10. Udo, Eli A. & Obiora, Isitua K., 2006. "Determinants of Foreign Direct Investment and Economic Growth in the West African Monetary Zone: A System Equations Approach," Conference papers 331519, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    11. M. Shahe Emran & M. Imam Alam & Forhad Shilpi, 2003. "After the "License Raj": Economic Liberalization and Aggregate Private Investment in India," Development and Comp Systems 0305002, University Library of Munich, Germany, revised 30 Aug 2003.
    12. Sebastian Edwards, 1987. "Economics Liberalization and the Equilibrium Real Exchange Rate in Developing Countries," UCLA Economics Working Papers 433, UCLA Department of Economics.
    13. H. Spencer Banzhaf & Kyle Mangum, 2019. "Capitalization as a Two-Part Tariff: The Role of Zoning," NBER Working Papers 25699, National Bureau of Economic Research, Inc.
    14. Krishna, Kala & Erzan, Refik & Tan, Ling Hui, 1994. "Rent Sharing in the Multi-fibre Arrangement: Theory and Evidence from U.S. Apparel Imports from Hong Kong," Review of International Economics, Wiley Blackwell, vol. 2(1), pages 62-73, February.
    15. Rehbein, Kathleen & Starks, Laura T., 1995. "Changes in U.S. trade policies: the wealth effects on Japanese steel firms," Japan and the World Economy, Elsevier, vol. 7(3), pages 309-327, September.
    16. Kenneth G. Willis & Stephen Malpezzi & A. Graham Tipple, 1990. "An Econometric and Cultural Analysis of Rent Control in Kumasi, Ghana," Urban Studies, Urban Studies Journal Limited, vol. 27(2), pages 241-257, April.
    17. de Melo, Jaime & Winters, L. Alan, 1990. "Do exporters gain from voluntary export restraints?," Policy Research Working Paper Series 326, The World Bank.
    18. Hoekman, Bernard & Martin, Will & Mattoo, Aaditya, 2010. "Conclude Doha: it matters!," World Trade Review, Cambridge University Press, vol. 9(3), pages 505-530, July.
    19. Blow, Laura & Crawford, Ian, 2002. "A nonparametric method for valuing new goods," Working Paper Series 143, European Central Bank.
    20. Lee, David & Saez, Emmanuel, 2012. "Optimal minimum wage policy in competitive labor markets," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 739-749.
    21. Alain Coen & Francois-Éric Racicot, 2006. "A New Approach Based on Cumulants for Estimating Financial Regression Models with Errors in the Variables: the Fama and French Model Revisited," RePAd Working Paper Series UQO-DSA-wp142006, Département des sciences administratives, UQO.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:352. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Roula I. Yazigi (email available below). General contact details of provider: https://edirc.repec.org/data/dvewbus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.