Trade policies in many developing countries discriminate--through import bans, licensing requirements, or higher tariff rates. Even Australia adds a $12,000 tariff on used cars. Such discrimination is often motivated by the desire to protect domestic industries from competition from low-priced...

Most Central American economies experienced slower growth in the 1980s than in the 1960s and 1970s, trailing far behind the Asian Tigers. Contributing to slow growth were severe external shocks, sizable macroeconomic disturbances, and widespread political instability. The challenges Central...

The authors use the common agency approach to analyze the joint determination of product and labor market distortions in a small (developing) open economy. Capital owners and union members lobby the government on tariffs and minimum wages, while factors of production in agriculture (the informal...

On February 2, 2002, Lithuania switched its currency anchor from the dollar to the euro. While pegging to the dollar (since April 1994) has proven successful throughout the transition years, the recent decision to peg to the euro was motivated by the increasing trade relations with European...

The authors develop a numerical endogenous growth model approximating an infinite horizon, which allows them to investigate the relationship between trade liberalization and economic growth. Economic theory generally implies that trade liberalization will improve economic growth, and the two...

Ag?or attempts to examine analytically and empirically the extent to which globalization affects the poor in low- and middle-income countries. He begins with a description of various channels through which trade openness and financial integration may have an adverse effect on poverty. However,...

Stories on the positive and negative effects of globalization on workers in developing countries abound. But a comprehensive picture is missing and many of the stories are ideologically charged. This paper reviews the academic literature on the subject, including several studies currently under...

The authors focus on policies facilitating firm adjustment to globalization. They briefly review the effects of trade and investment liberalization on firms, focusing on within-industry effects. They postulate that governments'role in supporting the process is to (1) ensure that firms...

The combination of distance, poor infrastructure, and being landlocked by neighbors with poor infrastructure, can make transport costs many times higher for some developing countries than for most others. Drawing on two traditions of economic modeling --Heckscher-Ohlin trade theory and von...

In the course of trade-policy reforms, countries must confront at least two important questions with respect to tariffs. First, what is the optimal structure of tariffs? In particular, is it optimal to tax all imports at a uniform rate? Second, should intermediate inputs be subject to import...