IDEAS home Printed from https://ideas.repec.org/p/fip/fedlwp/2018-003.html
   My bibliography  Save this paper

Offshoring Barriers, Regulatory Burden and National Welfare

Author

Listed:
  • Subhayu Bandyopadhyay
  • Arnab K. Basu
  • Nancy H. Chau
  • Devashish Mitra

Abstract

We present a model which considers both regulatory burden of offshoring barriers and possible terms of trade gains from such barriers. Non-tariff barriers are shown to be unambiguously welfare-reducing, and tariff barriers raise welfare only when associated terms-of-trade gains exceed resulting regulatory burdens, in which case there is a positive optimal offshoring tax. Otherwise, free trade is optimal. Welfare reductions from an offshoring tax are more likely with several developed nations engaging in offshoring. We derive and characterize the Nash equilibrium in such a case.

Suggested Citation

  • Subhayu Bandyopadhyay & Arnab K. Basu & Nancy H. Chau & Devashish Mitra, 2018. "Offshoring Barriers, Regulatory Burden and National Welfare," Working Papers 2018-3, Federal Reserve Bank of St. Louis.
    • Handle: RePEc:fip:fedlwp:2018-003
    DOI: 10.20955/wp.2018.003
    Note: Publisher DOI: https://doi.org/10.1007/s41775-023-00157-0
    as

    Download full text from publisher

    File URL: https://files.stlouisfed.org/files/htdocs/wp/2018/2018-003.pdf
    File Function: Full text
    Download Restriction: no
    File URL: https://doi.org/10.20955/wp.2018.003
    File Function: https://doi.org/10.20955/wp.2018.003
    Download Restriction: no
    File URL: https://libkey.io/10.20955/wp.2018.003?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    More about this item

    Keywords

    Offshoring tax; labor markets; terms of trade;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • H8 - Public Economics - - Miscellaneous Issues

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedlwp:2018-003. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anna Oates (email available below). General contact details of provider: https://edirc.repec.org/data/frbslus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.