Trade Liberalization and Trade Adjustment Assistance
AbstractWe explore the relationship between trade adjustment subsidies and successful reciprocal trade liberalization. We consider economies that are faced with a periodic need to move resources out of a declining import-competing sector, and that are attempting to sustain cooperative but self-enforcing trade agreements in the face of these adjustment needs. If the limitations associated with enforcement of international trade agreements are sufficiently severe, trade adjustment assistance can facilitate reciprocal trade liberalization. We argue that this suggests a possible efficiency rationale for adjustment policies that treat resources differently when traded sectors are involved.
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Bibliographic InfoPaper provided by EconWPA in its series International Trade with number 9411002.
Date of creation: 17 Nov 1994
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Other versions of this item:
- K.C. Fung & Robert W. Staiger, 1994. "Trade Liberalization and Trade Adjustment Assistance," NBER Working Papers 4847, National Bureau of Economic Research, Inc.
- F1 - International Economics - - Trade
- F2 - International Economics - - International Factor Movements and International Business
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