Everaert, Greetje; Vandenbussche, Hylke - 2001
budget constraints in an exporting country lead to higher levels of trade protection in the recipient country. Secondly, the … model predicts that protectionist trade policy helps to harden budget softness in the exporting country. We therefore argue … that, when industrial policy fails to enforce financial discipline, trade policy can take over this role. Finally, we …