In this paper, we use a detailed plant-level dataset to study the effect of two reforms aimed at increasing product market competition in India – liberalization of foreign direct investment (FDI) and reduction in tariff rates. First, we examine the effect of the liberalization policies on mean plant-level productivity in the liberalized industries. We find a 23% increase in productivity level f...

This study examined the effects of trade liberalization and exchange rate changes on carbohydrate staples in Nigeria. Secondary data published from 1974 to 2006 on cassava exports and rice imports as well as non-tradable carbohydrate staples were used. It was hypothesized that exchange rate changes and trade liberalization via price relatives, trade intensity and nominal protection coefficient ...

Available online 8 October 2011 We examine the effects of trade and services liberalization on wage inequality in India. We find that labor reallocations and wage shifts attributable to liberalization account for at most 29% of the increase in inequality between 1993 and 2004, and that the effects of services reforms are many times larger than those of trade liberalization. In contrast, 30–66% ...

We consider a simple political-economic model where capitalist investment is constrained by the government's temptation to expropriate. Political liberalization can relax this constraint, increasing the government's revenue, but also increasing the ruler's political risks. We analyze the ruler's optimal liberalization, where our measure of political liberalization is the probability of the rule...

Evidence supporting the positive effects of capital account liberalization on growth is mixed at best. Even after conditioning on the quality of domestic financial institutions, a significant number of studies still find no effect. One possible explanation is reverse causation. If low growth countries liberalize in order to spur growth, the observed correlation between growth and liberalization...

JULY/AUGUST 2003 75 Bekaert, Harvey, and Lundblad (BHL) are to be congratulated for producing another paper on equity market liberalizations in emerging markets, and it is a pleasure to discuss their work. Yet, there are three reasons why I may not be an impartial discussant: (i) Having devoted most of my fledgling career to the study of capital account liberalization in emerging markets, I am ...

This paper reviews both multi-country and country studies on the impact of trade liberalization on growth and employment in developing countries. These studies reveal sharply contrasting effects of trade liberalization on employment, suggesting that country-specifi c and contingent factors are important. In particular, differences in how trade liberalization is implemented are particularly impo...

Labor market consequences are at the forefront of most debates on the merits of trade liberalization. Preferential trade agreements (PTAs) have become the primary form of trade liberalization in most countries, and several studies have shown that discriminatory and nondiscriminatory trade liberalization can lead to very different outcomes. Yet to date there has not been any attempt to study the...

Are trade blocs stumbling blocks or building blocks? This chapter reviews many political economy arguments. First come those that suggest that regionalism undermines support for more generalized liberalization. Then we consider arguments that say that regional initiatives help build political momentum for global liberalization. Arguments as to how the adoption of a regional trading area might p...

Writings on the macroeconomic impact of capital account liberalization find few, if any, robust effects of liberalization on real variables. In contrast to the prevailing wisdom, I argue that the textbook theory of liberalization holds up quite well to a critical reading of this literature. The lion's share of papers that find no effect of liberalization on real variables tell us nothing about ...