This paper develops a general equilibrium model with transaction costs and endogenous and exogenous comparative advantages. In the model, the governments are allowed to choose between tariff war, tariff negotiation, and laissez faire regimes. The model shows that the level of division of labor...

In this study we examine the relationship between governance and agricultural performance by employing the World Bank's Aggregate Governance Indicators. Based on a cross-country panel sample, two methods are employed to test the hypothesis that better governance fosters agricultural...

This paper develops a Ricardian model with transaction costs and endogenous and exogenous comparative advantages. It shows that the level of division of labour and trade increases as transaction conditions improve. It identifies the conditions for trade negotiations that result in zero tariff...