Bandyopadhyay, Subhayu; Wall, Howard J. - Institute for the Study of Labor (IZA) - 2005
oligopolistic export sector and a competitive import-competing sector. When there is a minimum wage, an outsourcing tax might be … desirable and the usual profit-shifting objectives of an export subsidy are mitigated, perhaps completely, because it might lead … outsourcing. Further, if export subsidies are not possible due to WTO regulations, it is optimal to subsidize rather than to tax …