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Asymmetric model of neoclassical trade and optimum tax-subsidy-tariff policy

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  • Ghosh, Dilip K.
  • Arize, Augustine C.
  • Zaher, Angie

Abstract

This work constructs an asymmetric structure of neoclassical model of trade, and reexamines the theorems of trade, which were derived originally in 2 × 2 × 2 paradigm. Absence of non-traded sector, noted by Bhagwati, has been highlighted in a more serious fashion. Then optimum price distortions in the form of taxes, subsidies, and tariffs are introduced, and optimality of the price distortions is ascertained.

Suggested Citation

  • Ghosh, Dilip K. & Arize, Augustine C. & Zaher, Angie, 2017. "Asymmetric model of neoclassical trade and optimum tax-subsidy-tariff policy," The Journal of Economic Asymmetries, Elsevier, vol. 16(C), pages 87-100.
    • Handle: RePEc:eee:joecas:v:16:y:2017:i:c:p:87-100
    DOI: 10.1016/j.jeca.2017.09.001
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