The authors measure the responsiveness of returns to capital invested in six U.S. industries to shocks to the prices of competing import goods. Unanticipated, positive shocks to import prices cause higher than normal stock-market returns in all six industries. The magnitudes of these responses...

We propose a model of trade agreements in which contracting is costly, and as a consequence the optimal agreement may be incomplete. In spite of its simplicity, the model yields rich predictions on the structure of the optimal trade agreement and how this depends on the fundamentals of the...

The National Treatment (NT) clause is the first-line defense in the GATT (and in most other trade agreements) against opportunistic exploitation of the inevitable incompleteness of the agreement. This paper examines the role of NT as it applies to internal taxation under the GATT. It is shown...