International Trade and Trade Policy

Abstract

Centering on questions of the potential optimality of some trade protection, these original contributions present research at the frontier of international trade trade policy. They expand test the new trade theory that has developed during the last decade, incorporating elements of industrial organization political economy into the study of trade structure the formation of trade policy.Essays in the first two parts take up trade policy, addressing issues such as the formation of trading blocks, strategic trade policy, the political economy of protection, growth-oriented trade policies, including empirical studies of the welfare effects of quality - upgrading voluntary export restrictions import quotas. Essays in the third part discuss various structural issues such as trade in services, intersectoral adjustments, the advantage of early entry.Contents: Policy: Theory. Is Bilateralism Bad? Paul R. Krugman. Strategic Policy Direct Foreign Investment: When Are Tariffs Quotas Equivalent? James A. Levinsohn. Making Altruism Pay in Auction Quotas, Kala Krishna. On the Ineffectiveness of Made-to-Measure Protectionist Programs, Aaron Tornell. Subsidies Price Competition, Peter Adverse Selection in Credit Markets Infant Industry Harry Flam and Robert W. Staiger. Protection, Politics, Market Structure, Arye L. Hillman. Growth Welfare in a Small Open Economy, Gene M. Grossman and Elhanan Helpman. Trade Policy: Evidence. Quality Upgrading Its Welfare Cost in U.S. Imports, 1969-74, Randi Boorstein and Robert C. Feenstra. Counting the Cost of Voluntary Export Restraints in the European Car Market, Alasdair Smith and Anthony J. Venables. Structural Issues. Services in International Trade, Wilfred J. Ethier and Henrik Horn. First-Mover Advantages, Blockaded Entry, the Economics of Uneven Development, James R. Markusen. Wage Sensitivity Rankings Temporal Convergence, Ronald W. Jones and Peter Neary.