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Not all trade restrictions are created equally
| Content Provider | Semantic Scholar |
|---|---|
| Author | Cole, M. T. |
| Copyright Year | 2011 |
| Abstract | There has been great focus in the recent trade theory literature on the introduction of firm heterogeneity into trade models. This introduction has highlighted the importance of the entry/exit decision of firms in response to changes in trade barriers. However, it is typical in many of these models to use iceberg transport costs as a general form of trade barriers that can be interchangeable with ad valorem tariffs. I show that this is not always an appropriate conclusion. Specifically, I illustrate that profit for an exporter is more elastic in response to tariffs than iceberg transport costs, which affects the entry/exit decision of firms. This has implications for welfare analysis and empirical specifications. |
| Starting Page | 411 |
| Ending Page | 427 |
| Page Count | 17 |
| File Format | PDF HTM / HTML |
| DOI | 10.1007/s10290-011-0090-1 |
| Volume Number | 147 |
| Alternate Webpage(s) | https://researchrepository.ucd.ie/bitstream/10197/2642/1/wp10_09.pdf |
| Alternate Webpage(s) | http://www.ucd.ie/t4cms/wp10_09.pdf |
| Alternate Webpage(s) | https://www.econstor.eu/bitstream/10419/71347/1/740861050.pdf |
| Alternate Webpage(s) | https://doi.org/10.1007/s10290-011-0090-1 |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
