Free trade agreements without delocation
Small nations fear that FTAs with larger, richer nations will erode their industrial bases. These concerns are recognized in FTA and multilateral talks: small nations may explicitly or implicitly maintain higher trade barriers. Using a model where symmetric liberalization de-industrializes small, poor nations, we characterize the path of protection-asymmetries that allow liberalization without delocation. In welfare terms, the large nation prefers this no-delocation liberalization scheme only when barriers are sufficiently high; the small nation's ranking is reversed. An anti-delocation scheme involving international income transfers is also evaluated and found infeasible.
Year of publication: |
2000
|
---|---|
Authors: | Baldwin, Richard E. ; Robert-Nicoud, Frederic |
Published in: |
Canadian Journal of Economics. - Canadian Economics Association - CEA. - Vol. 33.2000, 3, p. 766-786
|
Publisher: |
Canadian Economics Association - CEA |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Agglomeration and Growth with and without Capital Mobility
Baldwin, Richard E., (2001)
-
Baldwin, Richard E., (2006)
-
Trade and growth with heterogenous firms
Baldwin, Richard E., (2006)
- More ...