Free Trade vs Strategic Trade: A Peek into Pandora's Box

Giovanni Maggi and Gene Grossman ()

Working Papers from Princeton, Woodrow Wilson School - Public and International Affairs

Abstract: We investigate whether a welfare-maximising government ought to pursue a program of strategic trade intervention or instead commit itself to free trade when, in the former case, domestic firms will have an opportunity to manipulate the government's choice of the level of intervention. Domestic firms may overinvest in physical and knowledge capital in a regime of strategic intervention in order to influence the government's choice of subsidy.

Keywords: EXPORTS; TRADE POLICY (search for similar items in EconPapers)
JEL-codes: F13 (search for similar items in EconPapers)
Date: 1997
References: Add references at CitEc
Citations Track citations by RSS feed

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: Free Trade Vs. Strategic Trade: A Peek into Pandora's Box (1998)
Working Paper: Free Trade vs. Strategic Trade: A Peek into Pandora's Box (1997)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:fth:priwpu:190

Access Statistics for this paper

More papers in Working Papers from Princeton, Woodrow Wilson School - Public and International Affairs
Address: PRINCETON UNIVERSITY, WOODROW WILSON SCHOOL OF PUBLIC AND INTERNATIONAL AFFAIRS, PRINCETON NEW- JERSEY 08542 U.S.A.
Contact information at EDIRC.
Series data maintained by Thomas Krichel ().