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Can a Periodic VER Raise Importing Country Welfare?

Author

Listed:
  • Gokcekus, Omer

    (North Carolina Central University)

Abstract

Several authors have argued that if exporting firms anticipate a voluntary expor t restriction in a future period, and they expect VERs to be allocated in p ro p o rtion to past exports, then they have an incentive to dump in the earlier period. In this paper we ask: How does a regime characterized by periodic VERs affect aggregate welfare, consumer welfare and import-competing pro - ducer welfare in the importing country? We discover paradoxically, that the answers are all uncertain. However, such a regime always shrinks worldwide efficiency, and normally, for the importer it shrinks aggregate welfare and consumer welfare and raises producer welfare.

Suggested Citation

  • Gokcekus, Omer, 1997. "Can a Periodic VER Raise Importing Country Welfare?," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 12, pages 485-504.
    • Handle: RePEc:ris:integr:0060
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    Keywords

    Periodic; VER;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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