The increase in investment abroad during the past two decades may help explain the simultaneous worldwide rush toward free trade. The entry of foreign capital may change the political game, increasing openness to international trade no matter what form the foreign capital takes (whether entering...

Evidence from Mercosur suggests that eliminating duty drawbacks for intra-regional exports would lead to increased counterlobbying against protection of intermediate products. Without the duty drawback, the common external tariff would have been an estimated 3.5 percentage points (25 percent)...

Lessons from world experience about the consequences of exchange rate overvaluation (the frequent cause of trade crises), the consequences of trying to defend an overvalued exchange rate, and the most appropriate policies for resolving an overvaluation

When technology transfer is costly, a foreign firm and host country government may differ in their preferences over direct entry and acquisition. Government intervention could help induce the socially preferred choice

Country size matters in determining the effectiveness of domestic and foreign competition on pricing behavior in manufacturing. Removing barriers to entry of new firms reduces markups more in large countries, while removing barriers to imports reduces markups more in small countries