Information Asymmetry and the Problem of Transfers in Trade Negotiations and International Agencies

Koichi Hamada () and Shyam Sunder
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Koichi Hamada: Economic Growth Center, Yale University

Working Papers from Economic Growth Center, Yale University

Abstract: This paper studies the role of transfers among groups within a country as well as among countries in a two level game of nternational trade negotiations. We show that in order to realize the intended transfer in the presence of asymmetric information on the states of recipients (and donors), a transfer process uses up additional resources. The difficulty of making transfers renders it less likely that a nation would find it individually rational to participate as a member of an international institution. Costly transfers render the internal and international adjustment difficult, and serve as a barrier to trade liberalization. Costly international transfers harden the resistance against trade liberalization in the (potentially) recipient country and soften it in the (potentially) donor country.

Keywords: International trade; tariff negotiation; asymmetric Information; transfer; WTO; common agency; two-level game (search for similar items in EconPapers)
JEL-codes: F13 H21 H71 H77 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2005-05
New Economics Papers: this item is included in nep-dev, nep-int, nep-pbe and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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http://www.econ.yale.edu/growth_pdf/cdp910.pdf (application/pdf)

Related works:
Working Paper: Information Asymmetry and the Problem of Transfers in Trade Negotiations and International Agencies (2005)
Working Paper: Information Asymmetry and the Problem of Transfers in Trade Negotiations and International Agencies (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:egc:wpaper:910

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