Strategic Distortion of the Objectives of Trade Policy

Jose Mendez-Naya

International Economic Journal, 2007, vol. 21, issue 4, 549-557

Abstract: By employing a simple three-country model in which there are two exporting countries and one consuming country, this paper analyses the consequences of one-country strategic distortion of the objectives of trade policy. It finds that although an exporting country can benefit from strategic distortion, it would be preferred that the importing country distorts its policy. Furthermore, it is found that preferential trading agreements can emerge endogenously.

Keywords: Trade policy; economic integration; commitment; distortion of objective functions (search for similar items in EconPapers)
Date: 2007
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DOI: 10.1080/10168730701698978

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