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Book part
Publication date: 1 October 2008

Binh Tran-Nam, Ngo Van Long and Makoto Tawada

This edited volume has its genesis in a conference entitled New Paradigms in Economics of Welfare and Trade under Globalisation and Regionalisation. Held at the Coogee…

Abstract

This edited volume has its genesis in a conference entitled New Paradigms in Economics of Welfare and Trade under Globalisation and Regionalisation. Held at the Coogee campus of the Australian School of Taxation (Atax), University of New South Wales (Sydney, Australia) from 8th to 10th August 2006, this conference brought together economic theorists from around the globe to celebrate Murray Kemp's 80th birthday. Conference participants and presenters included a former teacher, colleagues, co-authors, senior academics and many former students of Murray. After a two-year gestation period, the volume has finally been published. Half of the chapters in this book are derived from papers presented at the conference. The remaining half of the book consists of invited papers completed after the conference. All chapters in this volume were subjected to a formal reviewing and revision process.

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Content available
Book part
Publication date: 1 October 2008

Abstract

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Book part
Publication date: 1 October 2008

Ngo Van Long

Purpose – In this chapter we study the welfare effects of relaxing government restrictions on bidding by foreign firms for government procurement contracts.Methodology …

Abstract

Purpose – In this chapter we study the welfare effects of relaxing government restrictions on bidding by foreign firms for government procurement contracts.

Methodology – We use a modified version of the Tullock model of rent contests. Firms spend resources to influence decisions of awarding contracts. We consider the case where firms are heterogeneous in terms of lobbying effectiveness.

Findings – The opening of the bidding opportunities to foreign firms can, under certain conditions, improve social welfare of the liberalizing country. The gain partly comes from reduced aggregate domestic lobbying efforts, which implies lower social waste, and partly from tax revenue on the profits of winning foreign firms.

Practical implications – Our analysis indicates that when negotiating on opening up trade in services, governments should take into account the effects of foreign entry on domestic lobbying costs.

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Keywords

Content available
Book part
Publication date: 1 October 2008

Abstract

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Content available
Book part
Publication date: 1 October 2008

Abstract

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Book part
Publication date: 1 October 2008

Binh Tran-Nam

Purpose − The principal aim of this chapter is to present a comprehensive and critical review of Murray Kemp's contributions to the discipline of international trade and…

Abstract

Purpose − The principal aim of this chapter is to present a comprehensive and critical review of Murray Kemp's contributions to the discipline of international trade and welfare economics.

Methodology/Approach − This chapter employs the critical literature review approach, including archival analysis and face-to-face interviews.

Findings − It is shown that Kemp has been a key player in the modernization of trade theory. In particular, he has extended the theorems of gains from trade in many different directions and under the most general conditions.

Practical implications − In surveying Kemp's research contributions this chapter provides a useful overview of the development of the normative theory of trade. It also examines a number of methodological issues that may prove to be useful to economic theorists.

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Keywords

Book part
Publication date: 1 October 2008

Abstract

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Content available
Book part
Publication date: 1 October 2008

Abstract

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Article
Publication date: 26 September 2008

Ngo Van Long and Bodhisattva Sengupta

The purpose of this paper is to investigate conditions under which voters’ comparison of relative performance between adjacent jurisdictions can help reduce rent‐seeking…

Abstract

Purpose

The purpose of this paper is to investigate conditions under which voters’ comparison of relative performance between adjacent jurisdictions can help reduce rent‐seeking by politicians.

Design/methodology/approach

A theoretical model was developed to examine the effectiveness of yardstick competition in restraining political corruption, first under a static setting, and then under a dynamic setting, using optimal control theory and differential games. It is assumed that voters compare the performance of their incumbent government with that of a neighboring jurisdiction. The incumbent can provide a public good and extract rent, which are financed by imposing a distortionary tax on the population. Politicians derive utility from rent as well as from popularity. The stock of reputation builds up or decays over time. Reputation is decreasing in rent appropriation.

Findings

Without assigning an ex ante type on the politician, the paper demonstrates the possibility that yardstick competition itself fails to restrict rent seeking. When the model is extended to a dynamic setting, it is shown that under unitary performance evaluation, dynamic incentives restrain the politician only if the shadow value of reputation (that measures current and future marginal benefits of increased reputation) is sufficiently high throughout the term. it is shown that, for such a high shadow value to exist, benefits of both instantaneous and end‐of‐period reputations have to be high enough. On the other hand, under relative performance evaluation, dynamic incentives impose more restrictions on rent appropriation in comparison to the static case.

Originality/value

This paper offers the first formal analysis, using differential games, of the role of the interaction between electoral considerations and neighborhood demonstration effects (with respect to relative rent extraction) in determining a politician's optimal rent‐seeking behaviour.

Details

Indian Growth and Development Review, vol. 1 no. 2
Type: Research Article
ISSN: 1753-8254

Keywords

Book part
Publication date: 1 October 2008

Eric W. Bond and Constantinos Syropoulos

Purpose – This chapter examines how preferential liberalization between a pair of countries affects the terms of trade and welfare of the liberalizing countries and on the…

Abstract

Purpose – This chapter examines how preferential liberalization between a pair of countries affects the terms of trade and welfare of the liberalizing countries and on the rest of the world (ROW). We adopt a model with symmetric countries that generalizes previous work by relaxing assumptions on functional forms, which allows for the possibility that exports of member countries are complements for exports of the ROW.

Methodology/approach – This chapter uses general equilibrium welfare analysis for a three-country trade model.

Findings – We show that Kemp–Wan tariff adjustments require a decrease (increase) in the external tariff of members in a preferential trade agreement to accompany internal liberalization in the neighborhood of internal free trade when member goods are substitutes (complements) for non-member goods. However, the adjustment path of the external tariff to reductions in the internal tariff could be non-monotonic when preferences are not of the CES type.

Practical implications – Our results are of interest for the design of rules for multilateral trade agreements with respect to preferential liberalization, since they indicate how tariffs must be adjusted to eliminate negative impacts on non-member countries.

Details

Globalization and Emerging Issues in Trade Theory and Policy
Type: Book
ISBN: 978-1-84663-963-0

Keywords

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