The Welfare Effects of Imperfect Harmonisation of Trade and Industrial Policy

Konstantine Gatsios and Larry Karp

Economic Journal, 1992, vol. 102, issue 410, 107-16

Abstract: Partial cooperation in setting trade and industrial policies may not benefit members of a customs union if exporters outside the union react aggressively. Even if the union comprises the entire noncompetitive sector of industry, cooperation on trade policy may be disadvantageous if industrial policy (e.g., investment subsidies) are chosen noncooperatively; cooperation in trade policy may exacerbate the inefficiencies created by noncooperation in investment. Cooperation in choosing trade policies may also encourage investment by competitive importers and, thus, reduce the demand faced by the oligopolists; this may more than offset the ex post benefits of cooperation. Copyright 1992 by Royal Economic Society.

Date: 1992
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://links.jstor.org/sici?sici=0013-0133%2819920 ... 0.CO%3B2-3&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
Working Paper: The Welfare Effects of Imperfect Harmonization of Trade and Industrial Policy (1989)
Working Paper: The Welfare Effects of Imperfect Harmonization of Trade and Industrial Policy (1989)
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: https://EconPapers.repec.org/RePEc:ecj:econjl:v:102:y:1992:i:410:p:107-16

Ordering information: This journal article can be ordered from
http://www.blackwell ... al.asp?ref=0013-0133

Access Statistics for this article

Economic Journal is currently edited by Martin Cripps, Steve Machin, Woulter den Haan, Andrea Galeotti, Rachel Griffith and Frederic Vermeulen

More articles in Economic Journal from Royal Economic Society Contact information at EDIRC.
Bibliographic data for series maintained by Wiley-Blackwell Digital Licensing () and Christopher F. Baum ().