Markets for Risk and Openness to Trade: How are they Related?

Helena Svaleryd and Jonas Vlachos

No 327, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: It has long been argued that trade restrictions can be motivated by insurance considerations in the absence of full risk diversification. Recent literature suggests that markets for risk can alleviate resistance to reform and protectionist lobby group pressure. We empirically address the hypothesis that institutions which affect domestic risk reduction can facilitate liberal trade policy and show that there exists a robust positive relationship between openness to trade and the development of financial markets.

Keywords: Financial markets; trade policy (search for similar items in EconPapers)
JEL-codes: F13 G20 (search for similar items in EconPapers)
Pages: 36 pages
Date: 1999-06-22, Revised 2001-08-28
New Economics Papers: this item is included in nep-ifn
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Citations: View citations in EconPapers (7)

Published in Journal of International Economics, 2002, pages 396-395.

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Related works:
Journal Article: Markets for risk and openness to trade: how are they related? (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0327

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