Trade agreements with limited punishments
Lockwood, Ben and Zissimos, Ben (2002) Trade agreements with limited punishments. Working Paper. Coventry: University of Warwick. Centre for the Study of Globalisation and Regionalisation. Working papers (University of Warwick. Centre for the Study of Globalisation and Regionalisation) (No.87/).
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This paper shows that free trade can never be achieved when punishment for deviation from a trade agreement is limited to ‘a withdrawal of equivalent concessions’. This is where retaliation is not allowed to entail higher tariffs than those set by the initial deviant, and is the most severe form of punishment allowed under WTO rules. If, in addition, deviations from agreements are also limited in some way, then efficient self-enforcing tariff reductions must be gradual.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HF Commerce
J Political Science > JZ International relations
|Divisions:||Faculty of Social Sciences > Economics
Faculty of Social Sciences > Centre for the Study of Globalisation and Regionalisation
|Library of Congress Subject Headings (LCSH):||World Trade Organization, Free trade, Commercial treaties, International economic integration, International economic relations, Collective labor agreements|
|Series Name:||Working papers (University of Warwick. Centre for the Study of Globalisation and Regionalisation)|
|Publisher:||University of Warwick. Centre for the Study of Globalisation and Regionalisation|
|Place of Publication:||Coventry|
|Official Date:||January 2002|
|Number of Pages:||40|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Open Access|
|Funder:||Economic and Social Research Council (Great Britain) (ESRC), University of Warwick. Centre for the Study of Globalisation and Regionalisation (CSGR)|
 Bagwell, K. and R. Staiger (1990); “A Theory of Managed Trade.” American Economic
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