Foreign-owned Capital and Endogenous Tariffs

• 영문명: Foreign-owned Capital and Endogenous Tariffs
• 발행기관: 세종대학교 경제통합연구소
• 저자명: Marcelo Olarreaga
• 간행물 정보: 『Journal of Economic Integration』제14권 제4호, 606~624쪽, 전체 19쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 1999.12.31

영문 초록

During the last two decades we simultaneously observed an important increase in investment abroad and a rush towards free-trade worldwide. This paper argues that the former may (partially) help explain the latter. In a model of endogenous determination of trade protection through lobbying, where the government is also concerned by income redistribution among owners of foreign and national factors of production, entry of foreign capital into the host country will most likely reduce the endogenous level of protection. If the elasticity of substitution between labour and capital is sufficiently small, we show that protection cannot increase after the entry of foreign capital, regardless of the form of investment abroad (acquisition of existing domestic firms, or entry by foreign firms) or its trade orientation (whether foreign capital enters the export- or import-competing sector). (JEL- Classifications: F13, F21)

목차

Ⅰ. Introduction

Ⅱ. Foreign-owned Capital and Lobbying

Ⅲ. Foreign Equity Acquisition of Existing Domestic Firms

Ⅳ. New Entry by Foreign Firms and the Level of Protection

Ⅴ. Concluding remarks