Reciprocated unilateralism in trade reforms with majority voting

Pravin Krishna, Devashish Mitra

Research output: Contribution to journalArticlepeer-review

7 Scopus citations

Abstract

This paper shows how unilateral liberalization in one country can increase the voting support for reciprocal reduction in trade barriers in a partner country. When trade policies are determined simultaneously in the two countries, we show the possibility of multiple political equilibria - one in which the countries are both protectionist and another in which they trade freely with each other. Starting with trade protection in both countries, a unilateral reform in one country is shown to bring about a free trade equilibrium that obtains majority support in both countries.

Original languageEnglish (US)
Pages (from-to)81-93
Number of pages13
JournalJournal of Development Economics
Volume85
Issue number1-2
DOIs
StatePublished - Feb 2008

Keywords

  • Liberalization
  • Reciprocity
  • Tariff
  • Unilateralism
  • Voting

ASJC Scopus subject areas

  • Development
  • Economics and Econometrics

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