Concertina Reforms with International Capital Mobility

Udo Kreickemeier, Pascalis Raimondos-Møller

Research output: Working paperResearch

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Abstract

We show that the standard concertina result for tariff reforms -i.e. loweringthe highest tariff increases welfare - no longer holds in general if we allow for international capital mobility. The result can break down if the good whose tariff is lowered is not capital intensive. If the concertina reform lowers welfare it lowers market access as well, thereby compromising a second goal that is typically connected with trade liberalisation.JEL-Classification: F11, F13, F15Key words: Trade Policy Reform, International Factor Mobility, Welfare, MarketAccess
Original languageEnglish
Place of PublicationKøbenhavn
Number of pages16
Publication statusPublished - 2006

Cite this

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Concertina Reforms with International Capital Mobility. / Kreickemeier, Udo; Raimondos-Møller, Pascalis.

København, 2006.

Research output: Working paperResearch

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AB - We show that the standard concertina result for tariff reforms -i.e. loweringthe highest tariff increases welfare - no longer holds in general if we allow for international capital mobility. The result can break down if the good whose tariff is lowered is not capital intensive. If the concertina reform lowers welfare it lowers market access as well, thereby compromising a second goal that is typically connected with trade liberalisation.JEL-Classification: F11, F13, F15Key words: Trade Policy Reform, International Factor Mobility, Welfare, MarketAccess

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