Abstract
This paper examines the macroeconomic effects of tariffs in a two-country monetary optimizing model. With universal real wage rigidity, a tariff is likely to be more contractionary, (i) the larger the proportion of the labor force employed in the exportable sector, (ii) the smaller the share of expenditure on the exportable, and (iii) the lower (higher) the employment elasticity in the importable (exportable) industry. Under complete specialization in production, a tariff is contractionary domestically and beggar-thy-neighbor internationally, independent of the foreign wage behavior. [F13]
Full Text 
Sign-in/Register to access full text options
Sign-in/Register to access full text options 
Published version (
Free)
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
