We develop a new theoretical framework of trade agreement (TA) formation, called a ‘parallel contest', that emphasizes the political fight over TA ratification within countries. TA ratification is inherently uncertain in each country, where anti- and pro-trade interest groups contest each...

This paper examines the rationale for the rules on domestic subsidies in international trade agreements through a framework that emphasizes commitment. We build a model where the policy-maker has a tariff and a production subsidy at its disposal, taxation can be distortionary and the...

Rising current account and merchandise trade imbalances marked the years before the global financial and economic crisis. These imbalances either contributed to or precipitated the crisis and to the extent that they create systemic risks, it is desirable that they be reduced. There are many...

This paper reviews the most significant recent developments in the theory of trade agreements. The paper offers an integrated approach to evaluating trade agreements, and uses the approach to present results on preferential and multilateral trade agreements. The paper identifies also several...

This paper investigates the domestic government's antidumping duty choice in an asymmetric information framework where the foreign firm's cost is observed by the domestic firm, but not by the government. To induce truthful revelation, the government can design a tariff schedule, contingent on...

Special and Differential Treatment for Developing Countries (SDT) constitutes a central feature of the GATT/WTO system. Its formal goal is to foster export-led growth in developing countries. Its theoretical foundations and empirical support are, however, weak at best. In particular, SDT...

What do state-owned enterprises (SOEs) do? How do they respond to market incentives? Can we expect substantial efficiency gains from trade liberalization in economies with a strong presence of SOEs? Using a new dataset of Vietnamese firms we document a set of empirical regularities...