Consistent Trade Policy Aggregation

James Anderson

No 14046, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Most empirical policy work requires the aggregation of policies. Trade policy aggregation exemplifies the aggregation problem poignantly, with thousands of highly dispersed trade barriers. This paper provides methods of policy aggregation that are consistent with two common objectives of empirical work. One is to preserve real income. The other is to preserve the real volume of activity in the parts of the economy being aggregated. Both objectives must be achieved for consistent multi-country policy modeling. An application to India shows that the standard atheoretic method of aggregation overstates India's real income by around 3 times the global gains from free trade.

JEL-codes: C43 D58 F10 F13 F17 (search for similar items in EconPapers)
Date: 2008-05
New Economics Papers: this item is included in nep-int
Note: ITI
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Citations: View citations in EconPapers (3)

Published as James E. Anderson, 2009. "Consistent Trade Policy Aggregation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 50(3), pages 903-927, 08.

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Related works:
Journal Article: CONSISTENT TRADE POLICY AGGREGATION (2009)
Working Paper: Consistent Trade Policy Aggregation (2008)
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