The Most Favored Nation Principle: Passive Constraint or Active Commitment?
2
조회
0
다운로드
0
인용
0
참고문헌
키워드
초록
This study examines how the welfare implication of the “most-favored-nation” (MFN) principle changed when the trade agreement mode shifted from a “one-shot-multilateraltrade- agreement” to “sequential-bilateral-trade-agreements.” It emphasizes that the MFN principle works as “passive constraints” in the former but “active commitments” in the latter. Under the sequential-bilateral-trade-agreements, (i) an importing country strategically takes a cost-efficient country as its first (second) trading partner when the MFN principle is (not) embedded, and (ii) embedding the MFN clause improves the trade surplus of the importing country and the world economy. The MFN principle is utilized by the costefficient country as a commitment device to encourage production. This principle reverses the welfare implication in the existing literature. Finally, the importing country prefers the sequential agreements with the MFN clause to other cases in which it can choose simultaneous or sequential agreements with/without the MFN clause.
Abstract
This study examines how the welfare implication of the “most-favored-nation” (MFN) principle changed when the trade agreement mode shifted from a “one-shot-multilateraltrade- agreement” to “sequential-bilateral-trade-agreements.” It emphasizes that the MFN principle works as “passive constraints” in the former but “active commitments” in the latter. Under the sequential-bilateral-trade-agreements, (i) an importing country strategically takes a cost-efficient country as its first (second) trading partner when the MFN principle is (not) embedded, and (ii) embedding the MFN clause improves the trade surplus of the importing country and the world economy. The MFN principle is utilized by the costefficient country as a commitment device to encourage production. This principle reverses the welfare implication in the existing literature. Finally, the importing country prefers the sequential agreements with the MFN clause to other cases in which it can choose simultaneous or sequential agreements with/without the MFN clause.
참고문헌 (12)
- Aghion, P., "Negotiating Free Trade", Journal of International Economics, 73(1), pp.1~30 (2007)
- Bagwell, K., "Backward Stealing and Forward Manipulation in the WTO", Journal of International Economics, 82(1), pp.49~62 (2010)
- Brander, J. A., "Trade Warfare : Tariffs and Cartels", Journal of International Economics, 16(3-4), pp.227~242 (1984)
- Choi, J. P., "Optimal Tariffs and the Choice of Technology Discriminatory Tariffs vs. the ‘Most Favored Nation’ Clause", Journal of International Economics, 38(1-2), pp.143~160 (1995)
- Gatsios, K., "Preferential Tariffs and the ‘Most Favoured Nation’ Principle : A Note", Journal of International Economics, 28, pp.365~373 (1990)
- Herweg, F., "Price Discrimination in Input Markets : Downstream Entry and Efficiency", Journal of Economics & Management Strategy, 21(3), pp.773~799 (2012)
- Hwang, H., "Optimum Discriminatory Tariffs under Oligopolistic Competition", Canadian Journal of Economics, 24(3), pp.693~702 (1991)
- Kim, H., "Price Discrimination and Sequential Contracting in Monopolistic Input Markets", Economics Letters, 128, pp.39~42 (2015)
- Mcafee, R. P., "Opportunism in Multilateral Vertical Contracting : Nondiscrimination, Exclusivity, and Uniformity", American Economic Review, 84(1), pp.210~230 (1994)
- Multilateralising Regionalism : How Preferential Are Services Commitments in Regional Trade Agreements?, "Miroudot, S.", OECD, ~, pp.OECD Trade Policy Papers, 106 (2010)
- Seidmann, D. J., "Preferential Trading Arrangements as Strategic Positioning", Journal of International Economics, 79(1), pp.143~159 (2009)
- Yoshida, Y., "Third-Degree Price Discrimination in Input Markets : Output and Welfare", American Economic Review, 90(1), pp.240~246 (2000)