Does Free Trade Benefit All?
Although global free trade is efficient, each country's benefit from free trade depends on the path that leads to the global trade agreement. Using a dynamic model of trading bloc formation, we show that when global free trade is reached gradually, the countries that are initially excluded gain less than the rest and may be even made worse-off by the final free trade agreement, compared with the initial state of autarkies.
|Date of creation:||2005|
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