Trade Liberalization and Trade Adjustment Assistance
33 Pages Posted: 14 Aug 2007 Last revised: 1 Oct 2022
Date Written: September 1994
Abstract
We explore the relationship between trade adjustment subsidies and successful reciprocal trade liberalization. We consider economies that are faced with a periodic need to move resources out of a declining import-competing sector, and that are attempting to sustain cooperative but self-enforcing trade agreements in the face of these adjustment needs. If the limitations associated with enforcement of international trade agreements are sufficiently severe, trade adjustment assistance can facilitate reciprocal trade liberalization. We argue that this suggests a possible efficiency rationale for adjustment policies that treat resources differently when traded sectors are involved.
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Trade Adjustment Assistance: Welfare and Incentive Effects of Payments to Displaced Workers
-
Trade Adjustment Assistance and Pareto Gains from Trade
By Robert C. Feenstra and Tracy R. Lewis
-
Can Compensation Save Free Trade?
By Carl Davidson, Steven J. Matusz, ...
-
Is it Possible to Redistribute the Gains from Trade Using Income Taxation?
-
Trade-Related Job Loss and Wage Insurance: A Synthetic Review
-
On the Dynamics of Trade Diversion: Evidence from Four Trade Blocs
By Caroline L. Freund and John Mclaren
-
Trade, Wage Gaps, and Specific Human Capital Accumulation
By Ngo Van Long, Raymond G. Riezman, ...