A ‘New Trade’ Theory of GATT/WTO Negotiations

Ralph Ossa
NBER Working Paper No. 16388
Issued in September 2010
NBER Program(s):   ITI


I suggest a novel theory of GATT/WTO negotiations based on the Krugman (1980) «new trade» model. It emphasizes international production relocations and is easy to calibrate to bilateral trade data. Focusing on the major players in recent GATT/WTO negotiations, I find that it implies reasonable noncooperative tariffs as well as moderate gains from GATT/WTO negotiations.

A ‘New Trade’ Theory of GATT:WTO Negotiations

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