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Inter-Industrial Externality, Production Effects and Theory of International Trade

Author

Listed:
  • Hansang Lee

    (Hankuk University of Foreign Studies)

Abstract

This paper shows that under certain conditions protection given to the industrial sector (by a tariff, for instance) which depends on the externality generated by the agricultural sector may not achieve its desired objectives and may, in the short run, cause instability in the adjustment process. This is particularly true in a small open economy where agriculture occupies a less significant position in the economy both in the absolute and relative sense.

Suggested Citation

  • Hansang Lee, 1996. "Inter-Industrial Externality, Production Effects and Theory of International Trade," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 31(1), pages 91-99, January.
  • Handle: RePEc:dse:indecr:v:35:y:1996:i:1:p:91-99
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    More about this item

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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