Chaudhuri, Sarbajit and Banerjee, Dibyendu (2007): Consumption efficiency hypothesis and the optimality of free trade policy in a small open economy.
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The paper is designed to examine the optimality of the free trade policy in a small poor economy incorporating the consumption efficiency hypothesis in the simple two-by-two Heckscher-Ohlin-Samuelson (HOS) framework. It finds that the protectionist policy in the form of a tariff on the capital-intensive import-competing sector may improve social welfare and unambiguously raise the economy-wide effective employment.
|Item Type:||MPRA Paper|
|Institution:||University of Calcutta|
|Original Title:||Consumption efficiency hypothesis and the optimality of free trade policy in a small open economy|
|Keywords:||Consumption efficiency hypothesis; Optimality of free trade; Protectionist policy; Heckscher-Ohlin-Samuelson model; Effective employment|
|Subjects:||J - Labor and Demographic Economics > J4 - Particular Labor Markets > J41 - Labor Contracts
O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O15 - Human Resources; Human Development; Income Distribution; Migration
|Depositing User:||Sarbajit Chaudhuri|
|Date Deposited:||07. Aug 2007|
|Last Modified:||17. Feb 2013 12:17|
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