Electronic Resource
Oxford, UK
:
Blackwell Publishing Ltd
Review of international economics
4 (1996), S. 0
ISSN:
1467-9396
Source:
Blackwell Publishing Journal Backfiles 1879-2005
Topics:
Economics
Notes:
Governments in more-developed economies partially compensate import-competing industries when world prices fall, i.e., they lean against the wind. Less-developed economies often liberalize in response to the same shock. We use a political-support maximization model with revenue motives to derive conditions under which a rational policymaker would respond to lower woild prices by reducing tariff protection for an import-competing industry. An initial tariff that exceeds the maximum revenue level proves necessary but not sufficient for politically optimal liberalization following a fall in the world price of the importable good.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1111/j.1467-9396.1996.tb00103.x
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