This paper develops a model of the trade liberalization process, featuring both international negotiation and special-interest-driven domestic politics. We show that a country may wish to adopt a policy of unilaterally reducing its tariff whenever political opposition in other countries stalls...

How effective are “smart” sanctions in imposing costs on an adversary? We consider this question in a model where a targeted regime may choose to “shield” strategically important firms from harm. Using detailed firm and individual data, we estimate the impact on firm performance from...

When comparing the price of an individual good or service across different countries, it is necessary to use to a common metric. In reporting the prices of telecommunications services, the OECD converts prices into U.S. dollars using the Purchasing Power Parity (PPP) exchange rate, which takes...

We examine the role of trade policy uncertainty in shaping the import decisions of firms. If the adoption of a new input requires a sunk cost investment, then the prospect of price increases in that input, e.g. due to trade barriers, reduces the adoption of that input (a substitution effect) and...

This paper develops a model of the trade liberalization process, featuring both international negotiation and special-interest-driven domestic politics. We show that a country may wish to adopt a policy of unilaterally reducing its tariff whenever political opposition in other countries stalls...

The 2006 WTO Trade Policy Review of the United States reveals that national security concerns have become a dominant influence on US trade policy since 2001. This paper argues that direct and indirect effects of this influence have been deleterious to the multilateral trading system. Security...

The authors examine international trade in a commodity whose production creates a negative externality for the importing country and they consider the nations' strategic policy choices when they can restrict trade and when they are bound by a free-trade agreement. When pollution-abatement...