Why industrial policies fail: limited commitment

Larry Karp and Jeffrey Perloff

No 47044, CUDARE Working Papers from University of California, Berkeley, Department of Agricultural and Resource Economics

Abstract: The strategic effects of subsidies on output and subsidies on investment differ substantially in dynamic models where a government's commitment ability is limited. Output subsidies remain effective even as the period of commitment vanishes, but investment subsidies may become completely ineffective. This difference has been obscured because most existing models of strategic trade policy are static.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 37
Date: 1993-09
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https://ageconsearch.umn.edu/record/47044/files/CUDARE%20533R2%20Perloff.pdf (application/pdf)

Related works:
Journal Article: Why Industrial Policies Fail: Limited Commitment (1995)
Working Paper: Why industrial policies fail: limited commitment (1993)
Working Paper: Why Industrial Policies Fail: Limited Commitment (1993)
Working Paper: Why Industrial Policies Fail: Limited Commitment (1990)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ucbecw:47044

DOI: 10.22004/ag.econ.47044

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