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On 'CU can dominate UTR'

Listed author(s):
  • Ali El-Agraa
  • Anthony Jones
Registered author(s):

    For a decade and a half, Cooper and Massell's (1965) conclusion that a policy of unilateral tariff reduction (UTR) is superior to the formation of a customs union (CU) remained unchallenged. However Wonnacott and Wonnacott (1981) using a more realistic model, claimed to show that UTR need not dominate a CU. Here, we point out that the Wonnacott and Wonnacott model is incomplete since their CU does not have a common external tariff, and demonstrate that the incorporation of such a tariff in their analysis restores the validity of the Cooper and Massell proposition.

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    Article provided by Taylor & Francis Journals in its journal Applied Economics Letters.

    Volume (Year): 7 (2000)
    Issue (Month): 5 ()
    Pages: 301-304

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    Handle: RePEc:taf:apeclt:v:7:y:2000:i:5:p:301-304
    DOI: 10.1080/135048500351438
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