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Author: Kristina L. Buzard Publisher: ISBN: 9781267418838 Category : Commercial policy Languages : en Pages : 106
Book Description
The first chapter of the dissertation addresses general issues in contracting with external enforcement. We study a contracting environment with specific investments in which renegotiation, and therefore hold-up, is possible. We show that taking account of the precise nature of trading and investment technologies is important for accurately determining the trading relationships in which efficient investment and trade will occur and that careful modeling of institutional detail and the information available to private parties and the external enforcement body (e.g. a court) are key. The second chapter presents a model of international trade agreements in which domestic policy-making power is shared between executive and legislative branches of government. Acknowledging the complexity of the legislative process as well as its susceptibility to lobbying reveals a political commitment role for trade agreements in that executives can use them to reduce incentives for lobbying so that the legislatures can better withstand political pressure. This helps explain the result from tests of the Grossman and Helpman (1994) model that there is too much protection relative to contributions given estimates of governments' social-welfare weights : I predict that contribution levels may in fact be low because tariffs have been raised to prevent political pressure and the increased risk of a trade disruption it engenders. The third chapter extends this model to a repeated-game framework, replacing the assumption of external enforcement with self-enforcing promises of future cooperation. Here, the inability of actors to make commitments affects the design of trade agreements in two ways: executives must not only take into account the legislatures' lobbying-driven propensity to revoke delegation and break the agreement, but also be robust to the executives' own incentives to renegotiate out of any punishment scheme. The design of the dispute resolution mechanism that makes the optimal punishment incentive compatible must balance two, often-conflicting, objectives: longer punishment periods help to enforce cooperation by increasing the costs of defecting from the agreement, but because the lobbies prefer the punishment outcome, this also incentivizes lobbying effort and with it the political pressure to break the agreement. Thus the model generates new predictions for the optimal design of mechanisms for resolving the disputes that arise in the course of trade-agreement relationships.
Author: Kristina L. Buzard Publisher: ISBN: 9781267418838 Category : Commercial policy Languages : en Pages : 106
Book Description
The first chapter of the dissertation addresses general issues in contracting with external enforcement. We study a contracting environment with specific investments in which renegotiation, and therefore hold-up, is possible. We show that taking account of the precise nature of trading and investment technologies is important for accurately determining the trading relationships in which efficient investment and trade will occur and that careful modeling of institutional detail and the information available to private parties and the external enforcement body (e.g. a court) are key. The second chapter presents a model of international trade agreements in which domestic policy-making power is shared between executive and legislative branches of government. Acknowledging the complexity of the legislative process as well as its susceptibility to lobbying reveals a political commitment role for trade agreements in that executives can use them to reduce incentives for lobbying so that the legislatures can better withstand political pressure. This helps explain the result from tests of the Grossman and Helpman (1994) model that there is too much protection relative to contributions given estimates of governments' social-welfare weights : I predict that contribution levels may in fact be low because tariffs have been raised to prevent political pressure and the increased risk of a trade disruption it engenders. The third chapter extends this model to a repeated-game framework, replacing the assumption of external enforcement with self-enforcing promises of future cooperation. Here, the inability of actors to make commitments affects the design of trade agreements in two ways: executives must not only take into account the legislatures' lobbying-driven propensity to revoke delegation and break the agreement, but also be robust to the executives' own incentives to renegotiate out of any punishment scheme. The design of the dispute resolution mechanism that makes the optimal punishment incentive compatible must balance two, often-conflicting, objectives: longer punishment periods help to enforce cooperation by increasing the costs of defecting from the agreement, but because the lobbies prefer the punishment outcome, this also incentivizes lobbying effort and with it the political pressure to break the agreement. Thus the model generates new predictions for the optimal design of mechanisms for resolving the disputes that arise in the course of trade-agreement relationships.
Author: Eric W. Bond Publisher: World Scientific Publishing Company ISBN: 9789813141841 Category : Business & Economics Languages : en Pages : 350
Book Description
This book contains the main contributions of Eric Bond in the areas of international trade policy, trade agreements, and economic growth. The central focus of this volume is the author's pioneering work on the role of differences in market power across countries in explaining incentives to join preferential trade agreements and the form of trade agreements. Other topics include the interactions of physical and human capital accumulation in determining trade patterns and growth rates and the impact of non-tariff measures on international trade and investment. The volume also gives insights into the role of firm heterogeneity in domestic and international trade.
Author: Patricia Anne Mueller Publisher: ISBN: Category : Languages : en Pages : 187
Book Description
Chapter 1: I examine the welfare benefit of committing to a trade agreement when a politically-motivated government faces monopolistically competitive firms lobbying for tariff protection against imports. In my model, lobbying is costly to producers: each firm must pay a portion of the industry's upfront-lobby-formation fee as determined by a sequential bargaining game. I show that monopolistically competitive producers under-hire capital to avoid paying a larger share of lobbying costs. As a result, more varieties are produced than is socially optimal, and each firm operates at a higher-than-optimal marginal cost. Commitment to a trade agreement leads to a consolidation of firms in the market and a reduction in the tariff level. I show that a government benefits from committing to a trade agreement (i) on goods with very elastic or very inelastic demand, (ii) when the weight the government places on receiving political contributions from lobbyists is small, and (iii) when producers are strong bargainers and are able to capture the majority of the rents from protection. Chapter 2: In a model in which a small-country government faces domestic political-economy pressure and uncertainty over its terms of trade, a welfare-maximizing government benefits from having access to both rigid and flexible tariff policy options. I show that a welfare-maximizing government may prefer to join both a deep-integration regional trade agreement (helping it commit to free trade with key trading partners, thus correcting production distortions resulting from rent-seeking by politically organized sectors), and a large flexible agreement like the World Trade Organization (providing the flexibility in tariff levels and the institutional structure to pursue temporary tariff protection in response to shocks or unfair trade practices). My paper builds on the framework of Maggi and Rodriguez-Clare (1998), adding uncertainty over world prices and adding the option to join a trade agreement with the flexibility of a temporary escape clause.
Author: Publisher: Elsevier ISBN: 0444639268 Category : Business & Economics Languages : en Pages : 600
Book Description
Handbook of Commercial Policy explores three main topics that permeate the study of commercial policy. The first section presents a broad set of basic empirical facts regarding the pattern and evolution of commercial policy, with the second section investigating the crosscutting legal issues relating to the purpose and design of agreements. Final sections cover key issues of commercial policy in the modern global economy. Every chapter in the book provides coverage from the perspectives of multilateral, and where appropriate, preferential trade agreements. While most other volumes are policy-oriented, this comprehensive guide explores the ways that intellectual thinking and rigor organize research, further making frontier-level synthesis and current theoretical, and empirical, research accessible to all. Covers the research areas that are critical for understanding how the world of commercial policy has changed, especially over the last 20 years Presents the way in which research on the topic has evolved Scrutinizes the economic modeling of bargaining and legal issues Useful for examining the theory and empirics of commercial policy
Author: Wolfgang Peter Publisher: Kluwer Law International B.V. ISBN: 9041100377 Category : Law Languages : en Pages : 488
Book Description
This book is a second, revised edition of the original 1986 publication. Since then, the issue of contract change has increasingly challenged the business community and legal practitioners. The world-wide recession may well have accelerated the need to secure contractual relationships by reasonable flexibility. Successful foreign investment, a relentless challenge, is subject to many unpredictable errors. Of all these variables, however, successful investment is most dependent on the investor-host country relationship, which is the object of the present study. In particular, the pressure by host countries for contract change and its counterpart: the investor's defence of contract stability. The book is essentially a reference handbook for legal practitioners. It analyzes a variety of increasingly important questions concerning international investment agreements that come under pressure for change by one of the contracting parties: either a transnational corporation or a host country government. The seven case studies and the analytical chapters which follow are based on the author's research and the assistance of corporate and government officials, experts from the United Nations and other organizations, and members of academic research institutes.
Author: Kristina L. Buzard
Author: Kristina L. Buzard
Author: Norbert Horn
Author: Oliver Exton
Author: Eric W. Bond
Author: Patricia Anne Mueller
Author: Clive Maximilian Schmitthoff
Author: Asian Development Bank. Office of Regional Economic Integration
Author: 
Author: G. J. Lanjouw
Author: Wolfgang Peter