Cultural Effects of Trade Liberalization

Steven Suranovic and Robert Winthrop
Additional contact information
Robert Winthrop: Bureau of Land Management, US Dept. of Interior

International Trade from University Library of Munich, Germany

Abstract: We incorporate culture into a standard trade model in two distinct ways. In the ¡°cultural affinity from work¡± model, workers receive a non- pecuniary cultural benefit from work in a particular industry. In the ¡°cultural externality¡± model, consumers of a product receive utility from other consumer¡¯s consumption of a domestic good. We show that resistance to change due to cultural concerns can reduce the national benefits from trade liberalization. Complete movements to free trade will have a positive national welfare impact in the cultural affinity case whereas it may lower national welfare in the cultural externality case. We also show that a loss of cultural benefits is more likely to occur in the externality model.

Keywords: Cigarettes; smoking; addiction; Behavioral economics (search for similar items in EconPapers)
JEL-codes: F1 F11 F16 Z1 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2005-11-08
New Economics Papers: this item is included in nep-int
Note: Type of Document - pdf; pages: 31
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpit:0511003

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