Previous analyses of free trade areas suggest that member countries reduce external tariffs to the level that improves welfare of non-member countries. Using an oligopoly model with product differentiation, this paper shows that when a free trade area entails endogenous change from segmented to integrated markets for internally produced goods, external tariffs become strategic complements and t...

The Uruguay Round Agreements and the establishment of the World Trade Organisation (WTO) in 1995 resulted in a major step forward by bringing the agriculture and services sectors under the disciplines of GATT, bringing down the levels of tariffs and putting in place a dispute settlement mechanism. In order to realise the potential gains from trade, developing countries made substantial progress...

New BEA paper on vertical goods, which in turn are inputs direct investment, allowing specialization trade to final consumption goods. All firms to offshore while keeping Manufacturing trade and verti­ three types of goods may be production within the firms. cal specialization trade, which traded but face transportation Trade among affiliated firms can be defined as trade in goods costs and tar...

A strategy to convert quotas to tariffs is to auction the quota rights and use the realized auction prices as guides to setting tariffs. In the 1980s, New Zealand employed auctions to allocate quota licenses. We analyze the relationship between tariff-equivalents and auction prices for auctions with resale. Using panel data from New Zealand’s quota license auctions, we estimate the expected val...

We examine interaction between goods trade and market power in domestic trade and distribution sectors. Theory suggests a linkage between service-sector competition and goods trade, one supported by econometrics involving imports of 22 OECD countries vis-à-vis 69 exporters. This points to linkages between market access conditions for goods and the structure of the service sector. Competition in...

Establishing separated markets for capacity, energy, and ancillary services (AS) is one of the key steps to liberalize electricity sector realize markets. This study aims at eliciting AS tariffs from unified capacity energy through a cost-based approach. In proposed framework, maintaining annual revenue requirements power plants are considered as main objective while separating tariff tariffs. ...