Trade, product variety and welfare: A quantitative assessment for the transition economies in Central and Eastern Europe

Michael Funke and Ralf Ruhwedel ()

Macroeconomics from University Library of Munich, Germany

Abstract: We calculate welfare gains of trade liberalization in the Central and East European transition economies, following the approach of Romer (1994), who emphasized that proper modeling of the impact of trade restrictions on the number of available product varieties is crucial to quantifying the welfare impact of trade liberalization. The empirical work relies on direct measures of product variety calculated from 5- digit trade data. Although the issue is far from settled, the emerging conclusion is that freer trade has boosted welfare.

Keywords: Trade Liberalization; Product Variety; Welfare; Transition Economies (search for similar items in EconPapers)
JEL-codes: D60 F14 F15 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2004-01-30
New Economics Papers: this item is included in nep-eec, nep-mic and nep-tra
Note: Type of Document - ; pages: 24; figures: included
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Related works:
Working Paper: Trade, Product Variety and Welfare: A Quantitative Assessment for the Transition Economies in Central and Eastern Europe (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpma:0401016

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