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...

The paper examines the relationship between China's grain trade and domestic grain economy through an institutional perspective. It reveals that China's grain imports have been primarily necessitated by filling the physical gap between domestic grain demand and supply. Due to the special institutional background under which the domestic grain economy segmented into two relatively independent pa...

In this paper we analyze a country’s optimal trade policy when its labor market is unionized and firms are footloose. We show that an important objective for governments to use import protection is to prevent their domestic multinationals to go to a non-unionized location abroad and to serve their country from a distance. A domestic government will set a positive tariff to dissuade its multinat...

The World Trade Organisation (WTO) which became operational on 1 January 1995 is the successor to the General Agreement on Tariffs and Trade (GATT). The WTO provides the legal framework for world trade, and it has been given extensive regulatory and supervisory powers. Whereas the GATT was solely concerned with trade liberalization based on tariff concessions, the WTO’s approach embraces discus...

One of the most salient changes in the world economy since 1980 has been the move toward freer trade among countries across the globe. How do existing theories about trade policy explain this puzzle? Three sets of explanations are prominent. First, many focus on changes in trade policy preferences among domestic actors, either societal groups or political leaders. Second, scholars examine chang...

Building on the framework of Maggi and Rodr̀ıguez-Clare (1998), this paper will explore whether a small country facing domestic political pressures values joining a trade agreement with flexibility in the form of an escape clause (a feature included in many trade agreements, including the WTO). More specifically, this paper will examine if a government would prefer to join a trade agreement with...

This study has conducted to find the effects of trade deficit on the economy of Pakistan in which trade deficit is the independent and gross domestic product, foreign direct investment exchange rate are the dependent variables. Depending on the availability of data we have selected the longest possible sample period to avoid the small sample bias. A sample period of 24 years has been selected f...

Problem statement: One of the main targets of Iran’s economic development plans in agricultural sector during the recent years was to augment agricultural exports and establish a positive trade balance in this sector. In this research the impact of macroeconomic indicators of Iran and its 20 trading partners on Iran’s agricultural trade balance had been investigated. Approach: The ARDL approach...

This paper elaborates on the government's powers - both at the domestic level and over foreign countries. The domestic power is the power against domestic lobbies, and the foreign one is the government's international power. To do so, this paper tries to evaluate the effects of these powers   on the formation of free trade agreements (FTAs). The theoretical framework follows an oligopolistic-po...

In this paper we study the optimal import policy in an oligopolistic market with a given number of quantity-setting firms. In the absence of fixed costs, we show that if the policy instrument is an import quota, the optimal policy is either free trade or autarky, while if the instrument is a tariff the optimal policy is neither free trade nor autarky. In the case of fixed costs, we show that co...