IDEAS home Printed from https://ideas.repec.org/a/wly/canjec/v39y2006i2p544-563.html

The adjustment of external tariffs in the Kemp‐Wan‐Grinols compensation scheme

Author

Listed:
  • Siu‐kee Wong

Abstract

. This paper considers the adjustment of external tariffs when two countries integrate and implement the Kemp‐Wan‐Grinols compensation scheme. Attention is also paid to the restrictions set by Article XXIV of GATT. This paper shows how the external tariffs would change in a three‐good, three‐country model under the assumption of gross substitutability. The results are sensitive to the initial trade pattern. In particular, they depend on the number of goods initially traded between the member countries. The analysis can be extended to a multi‐commodity model if the preferences of the countries have identical CES representation. JEL classification: F11, F15 L’ajustement des tarifs douaniers avec le monde extérieur dans le schème de compensation à la Kemp‐Wan‐Grinols. Ce mémoire examine l’ajustement des tarifs avec le monde extérieur quand deux pays forment un tout économique intégré et mettent en place un schème de compensation à la Kemp‐Wan‐Grinols. On prend en compte les restrictions imposées par l’article XIV du GATT. On indique comment les tarifs avec le monde extérieur changeraient dans un modèle à trois pays et trois biens quand on postule un degré général de substituabilité. Les résultats dépendent du pattern initial de commerce : en particulier, ils dépendent du nombre de biens initialement échangés entre les pays membres. L’analyse peut être généralisée à un modèle à plusieurs biens si les préférences des pays ont une représentation CES identique.

Suggested Citation

  • Siu‐kee Wong, 2006. "The adjustment of external tariffs in the Kemp‐Wan‐Grinols compensation scheme," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(2), pages 544-563, May.
    • Handle: RePEc:wly:canjec:v:39:y:2006:i:2:p:544-563
    DOI: 10.1111/j.0008-4085.2006.00359.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.0008-4085.2006.00359.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.0008-4085.2006.00359.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. James E. Anderson & J. Peter Neary, 1996. "A New Approach to Evaluating Trade Policy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 63(1), pages 107-125.
    2. Grandmont, J. M. & McFadden, D., 1972. "A technical note on classical gains from trade," Journal of International Economics, Elsevier, vol. 2(2), pages 109-125, May.
    3. Srinivasan, T. N., 1997. "The common external tariff of a customs union: Alternative approaches," Japan and the World Economy, Elsevier, vol. 9(4), pages 447-465, December.
    4. Bond, Eric W. & Syropoulos, Constantinos & Winters, L. Alan, 2001. "Deepening of regional integration and multilateral trade agreements," Journal of International Economics, Elsevier, vol. 53(2), pages 335-361, April.
    5. Kemp, Murray C. & Wan, Henry Jr., 1976. "An elementary proposition concerning the formation of customs unions," Journal of International Economics, Elsevier, vol. 6(1), pages 95-97, February.
    6. Drabicki, John Z. & Takayama, Akira, 1979. "An antinomy in the theory of comparative advantage," Journal of International Economics, Elsevier, vol. 9(2), pages 211-223, May.
    7. Lloyd, P. J., 1982. "3 x 3 theory of customs unions," Journal of International Economics, Elsevier, vol. 12(1-2), pages 41-63, February.
    8. Raymond RIEZMAN, 2013. "A 3 × 3 Model of Customs Unions," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 1, pages 7-20, World Scientific Publishing Co. Pte. Ltd..
    9. Berglas, Eitan, 1979. "Preferential Trading Theory: The n Commodity Case," Journal of Political Economy, University of Chicago Press, vol. 87(2), pages 315-331, April.
    Full references (including those not matched with items on IDEAS)

    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. Lisandro Abrego & Raymond Riezman & John Whalley, 2006. "How reasonable are assumptions used in theoretical models? Computational evidence on the likelihood of trade pattern changes," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(3), pages 781-789, August.
    2. Waschik, Robert, 2009. "The effects of free trade areas on non-members: Modelling Kemp-Vanek admissibility," Journal of Policy Modeling, Elsevier, vol. 31(5), pages 648-663, September.
    3. McCalla, Alex F., 1992. "GATT, Preferential/Regional Trading Blocks and Agricultural Trade," 1992 Conference (36th), February 10-13, 1992, Canberra, Australia 146544, Australian Agricultural and Resource Economics Society.
    4. Bond, Eric W. & Syropoulos, Constantinos & Winters, L. Alan, 2001. "Deepening of regional integration and multilateral trade agreements," Journal of International Economics, Elsevier, vol. 53(2), pages 335-361, April.
    5. Lisandro Abrego & Raymond Riezman & John Whalley, 2002. "How Often Are Propositions On The Effects Of Regional Trade Agreements Theoretical Curiosa And When Should They Guide Policy?," University of Western Ontario, Departmental Research Report Series 20024, University of Western Ontario, Department of Economics.
    6. Wisarut Suwanprasert, 2020. "The role of the most favored nation principle of the GATT/WTO in the New Trade model," Review of International Economics, Wiley Blackwell, vol. 28(3), pages 760-798, August.
    7. Kemp, Murray, 2008. "Non-competing factor groups and the normative propositions of trade theory," International Review of Economics & Finance, Elsevier, vol. 17(3), pages 388-390.
    8. Panagariya, A., 1997. "Preferential trading and the myth of natural trading partners," Japan and the World Economy, Elsevier, vol. 9(4), pages 471-489, December.
    9. Hideo Konishi & Carsten Kowalczyk & Tomas Sjostrom, 2003. "Free Trade, Customs Unions, and Transfers," Boston College Working Papers in Economics 568, Boston College Department of Economics.
    10. Haaparanta, Pertti, 1988. "Customs unions and national budgets," Bank of Finland Research Discussion Papers 18/1988, Bank of Finland.
    11. Pokrivcak, Jan, 2007. "Economics and Political Economy of Regional Trade Agreements," Working Papers 7286, TRADEAG - Agricultural Trade Agreements.
    12. repec:bla:reviec:v:17:y:2009:i:si:p:304-309 is not listed on IDEAS
    13. Burfisher, Mary E. & Robinson, Sherman & Thierfelder, Karen, 2004. "Regionalism: Old And New, Theory And Practice," MTID Discussion Papers 16137, CGIAR, International Food Policy Research Institute (IFPRI).
    14. Suska Magdalena, 2025. "Integration theories: A review of selected political and economic concepts," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 61(2), pages 123-134.
    15. Yu-Ter Wang & Bih-Jane Liu & Pan-Long Tsai, 2004. "Trade Policy and Economic Integration in a Cournot Duopoly Model," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 43(3), pages 239-251.
    16. Takaaki Aoki, 2008. "Some aspects on regional integration, comparative advantage and consumer's diversity," Applied Economics, Taylor & Francis Journals, vol. 40(18), pages 2361-2368.
    17. Mary E. Burfisher & Sherman Robinson & Karen Thierfelder, 2004. "Regionalism: Old and New, Theory and Practice," Chapters, in: Giovanni Anania & Mary E.. Bohman & Colin A. Carter & Alex F. McCalla (ed.), Agricultural Policy Reform and the WTO, chapter 23, pages 593-622, Edward Elgar Publishing.
    18. Eric W. Bond & Raymond G. Riezman & Constantinos Syropoulos, 2013. "A strategic and welfare theoretic analysis of free trade areas," World Scientific Book Chapters, in: Raymond Riezman (ed.), International Trade Agreements and Political Economy, chapter 8, pages 101-127, World Scientific Publishing Co. Pte. Ltd..
    19. Peter J. Lloyd & Donald Maclaren, 2004. "Gains and Losses from Regional Trading Agreements: A Survey," The Economic Record, The Economic Society of Australia, vol. 80(251), pages 445-467, December.
    20. A.R. Kemal, 2004. "Exploring Pakistan’s Regional Economic Cooperation Potential," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 43(4), pages 313-334.
    21. Fritz Breuss, 2007. "A Prototype Model of EU's 2007 Enlargement," FIW Working Paper series 007, FIW.

    More about this item

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

    Statistics

    Access and download statistics

    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:wly:canjec:v:39:y:2006:i:2:p:544-563. 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: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1111/(ISSN)1540-5982 .

    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.