Mitigating the adjustment costs of international trade

This brief examines possible policy responses to the adjustment costs related to international trade. It argues that, contrary to the conclusions drawn from frictionless neoclassical models, the costs of adjusting to trade are large and persistent and may be a cause of the increase in the political...

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Autores principales: Akman, Sait, Brandi, Clara, Dadush, Uri, Draper, Peter, Freytag, Andreas, Kautz, Miriam, Rashish, Peter, Schwarzer, Johannes, Vos, Rob
Formato: Artículo preliminar
Lenguaje:Inglés
Publicado: Kiel Institute for the World Economy 2018
Materias:
Acceso en línea:https://hdl.handle.net/10568/145437
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author Akman, Sait
Brandi, Clara
Dadush, Uri
Draper, Peter
Freytag, Andreas
Kautz, Miriam
Rashish, Peter
Schwarzer, Johannes
Vos, Rob
author_browse Akman, Sait
Brandi, Clara
Dadush, Uri
Draper, Peter
Freytag, Andreas
Kautz, Miriam
Rashish, Peter
Schwarzer, Johannes
Vos, Rob
author_facet Akman, Sait
Brandi, Clara
Dadush, Uri
Draper, Peter
Freytag, Andreas
Kautz, Miriam
Rashish, Peter
Schwarzer, Johannes
Vos, Rob
author_sort Akman, Sait
collection Repository of Agricultural Research Outputs (CGSpace)
description This brief examines possible policy responses to the adjustment costs related to international trade. It argues that, contrary to the conclusions drawn from frictionless neoclassical models, the costs of adjusting to trade are large and persistent and may be a cause of the increase in the political resistance to trade. The existing mechanisms specifically designed to mitigate the adjustment costs related to trade are inadequate, and they are often a source of inefficiency and inequity since trade shocks are only a part of the economic uncertainty affecting workers. The brief also argues that the most promising policies are those that extend the social safety net where necessary, protecting workers from all shocks, not just trade shocks, and those that facilitate the mobility of factors of production across sectors and regions. Many of the latter policies should be pursued anyway to improve the nation’s competitiveness. As has become increasingly evident over the past year, protectionism and unfair trade practices can also be a source of trade shocks affecting exporters in partner countries, underscoring the importance of maintaining an open, rules-based and predictable trading system.
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spelling CGSpace1454372024-10-25T07:54:36Z Mitigating the adjustment costs of international trade Akman, Sait Brandi, Clara Dadush, Uri Draper, Peter Freytag, Andreas Kautz, Miriam Rashish, Peter Schwarzer, Johannes Vos, Rob trade liberalization labour market international cooperation protection technology trade barriers economic policies wto climate change mitigation equality This brief examines possible policy responses to the adjustment costs related to international trade. It argues that, contrary to the conclusions drawn from frictionless neoclassical models, the costs of adjusting to trade are large and persistent and may be a cause of the increase in the political resistance to trade. The existing mechanisms specifically designed to mitigate the adjustment costs related to trade are inadequate, and they are often a source of inefficiency and inequity since trade shocks are only a part of the economic uncertainty affecting workers. The brief also argues that the most promising policies are those that extend the social safety net where necessary, protecting workers from all shocks, not just trade shocks, and those that facilitate the mobility of factors of production across sectors and regions. Many of the latter policies should be pursued anyway to improve the nation’s competitiveness. As has become increasingly evident over the past year, protectionism and unfair trade practices can also be a source of trade shocks affecting exporters in partner countries, underscoring the importance of maintaining an open, rules-based and predictable trading system. 2018-08-02 2024-06-21T09:04:30Z 2024-06-21T09:04:30Z Working Paper https://hdl.handle.net/10568/145437 en Open Access Kiel Institute for the World Economy Akman, Sait; Brandi, Clara; Dadush, Uri; Draper, Peter; Freytag, Andreas; Kautz, Miriam; Rashish, Peter; Schwarzer, Johannes; and Vos, Rob. 2018. Mitigating the adjustment costs of international trade. Economics Discussion Papers No. 2018-49. Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2018-49
spellingShingle trade liberalization
labour market
international cooperation
protection
technology
trade barriers
economic policies
wto
climate change mitigation
equality
Akman, Sait
Brandi, Clara
Dadush, Uri
Draper, Peter
Freytag, Andreas
Kautz, Miriam
Rashish, Peter
Schwarzer, Johannes
Vos, Rob
Mitigating the adjustment costs of international trade
title Mitigating the adjustment costs of international trade
title_full Mitigating the adjustment costs of international trade
title_fullStr Mitigating the adjustment costs of international trade
title_full_unstemmed Mitigating the adjustment costs of international trade
title_short Mitigating the adjustment costs of international trade
title_sort mitigating the adjustment costs of international trade
topic trade liberalization
labour market
international cooperation
protection
technology
trade barriers
economic policies
wto
climate change mitigation
equality
url https://hdl.handle.net/10568/145437
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