Tariff Wars and Trade Deals with Costly Government
The authors study a simple model of tariff wars and trade deals in which government revenue collection and disbursement uses resources. The introduction of costly governments leads to lower non-cooperative tariffs, the possibility that a less costly government may win a tariff war, and fully cooperative trade deals where countries lower tariffs but do not eliminate them, even with lump-sum taxes and transfers. Copyright Blackwell Publishing Ltd 2004.
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Volume (Year): 12 (2004)
Issue (Month): 3 (08)
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References listed on IDEAS
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"Protection for Sale,"
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International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 29(1), pages 81-85, February.
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"A Coalition-Formation Approach to Equilibrium Federations and Trading Blocs,"
American Economic Review,
American Economic Association, vol. 87(5), pages 940-56, December.
- John B. Burbidge & James A. DePater & Gordon M. Myers & Abhijit Sengupta, 1996. "A Coalition-formation Approach to Equilibrium Federations and Trading Block s," Department of Economics Working Papers 1996-05, McMaster University.
- de Melo, Jaime & Montenegro, Claudio & Panagariya, Arvind, 1992. "Regional integration, old and new," Policy Research Working Paper Series 985, The World Bank.
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