This paper examines international trade in tainted food and other low-quality products. Wefirst find that for a large … class of environments, free trade is the trading system that conveysthe highest incentives to produce non-tainted high …-quality goods by foreign exporters.However, free trade cannot prevent the export of tainted products, and the condition fortainting …

, developing implications for welfare-improving government policy using primitive economic building blocks. Using a simple model of … alternative food subsidy policies, with and without enforcement costs of targeting subsidies to the poor. In three models of … imperfect information in credit markets, the chapter characterizes equilibrium financial contracts and policy remedies to …