Kawabata, Yasushi; Yanase, Akihiko; Kurata, Hiroshi - In: Journal of the Japanese and International Economies 24 (2010) 4, pp. 569-585
We investigate the effects of free trade agreements (FTAs) on tariffs and welfare in vertical trade. We consider a three-country model, where an FTA is formed between a country exporting a final good and a country exporting an intermediate good. The FTA unambiguously leads to a reduction in the...
