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Sustaining free trade in repeated games without government commitment |
Devereux, Michael B.
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The paper examines how free trade can be sustained in a repeated tariff game in a simple two-country general equilibrium model. In the standard model, free trade can be sustained by "punishment strategies" with only a mild degree of forward looking behaviour on the part of governments. However, when there are short term factor market rigidities, and governments cannot precommit to an ex-ante optimal tariff, it may be much more difficult to sustain free trade. This is illustrated in two models. Social Sciences and Humanities Research Council of Canada A hard copy is available in UCD Library at GEN 330.08 IR/UNI
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Keyword(s):
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Free trade--Econometric models; Tariff; Equilibrium (Economics) |
Publication Date:
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2009 |
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Type:
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Working paper |
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Peer-Reviewed:
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Unknown |
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Language(s):
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English |
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Institution:
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University College Dublin |
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Publisher(s):
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University College Dublin. School of Economics |
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File Format(s):
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other; application/pdf |
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First Indexed:
2012-08-25 05:22:19 Last Updated:
2018-10-11 15:43:31 |
