This paper argues that labor market distortions in transition and developing economies help explain differential impacts of trade liberalization. We assume that workers differ in ability. In a market economy their earnings depend on their ability. However, earnings are independent of ability due...

This paper considers the implications of relationship-specific investment within keiretsu for policies aimed at opening the Japanese market for intermediate goods, such as auto parts. Both VIEs applied to parts and VERs restricting Japanese exports of autos cause the keiretsu to import a wider...

In contrast to existing work which takes an ex-ante approach and looks for policy prescriptions which yield welfare improvements, we take an ex-post approach. We ask whether there are indicators which show whether welfare has risen or not in the wake of a reform. That is, we look for evidence of...