The Effects of Trade Policy Reform: What Do We Really Know? / Ann Harrison, Ana Revenga.

Format:

Book

Author/Creator:

Harrison, Ann.

Contributor:

National Bureau of Economic Research.

Revenga, Ana.

Series:

Working Paper Series (National Bureau of Economic Research) no. w5225.

NBER working paper series no. w5225

Language:

English

Subjects (All):

Commercial policy--Econometric models.

Commercial policy.

International trade.

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

The Effects of Trade Policy Reform

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1995.

Cambridge, Massachusetts : National Bureau of Economic Research, 1995.

Summary:

The magnitude of existing research on the effects of trade reform is impressive. Yet economists have not reached a clear consensus on a number of important questions such as the labor market impact of trade reform, the linkages between trade and foreign direct investment, and the relationship between trade and growth. In this paper we attempt to clarify what we know about the relationship between trade reform, factor markets, and growth. Although many studies have shown a positive relationship between various measures of openness and growth, many nagging problems remain. Trade policy is almost never measured using the most obvious indicators -- such as tariffs. In addition, many studies are plagued by serious econometric problems. The evidence on labor markets and trade reform is less extensive. Based on the studies to date, it appears that the unemployment and wage effects of trade reforms have generally been small. In the paper, we discuss the possibility that small wage and employment responses are due to labor market regulations. The paper concludes with an analysis of the linkages between trade policies and foreign investment flows. Our evidence suggests that trade reform has been accompanied by significant increases in investment inflows.

Notes:

Print version record

August 1995.