peer group formation in an adverse selection model this paper develops an adverse selection model where peer group systems are shown to trigger lower interest rates and remove credit rationing in the case where borrowers are uninformed about their potential partners and ex post state verification or auditing by banks is costly peer group formation reduces interest rates due to a collateral effect namely cross subsidisation amongst borrowers acts as collateral behind a loan by uncovering such a collateral effect this paper shows that peer group systems can be viewed as an effective risk pooling mechanism and thus enhance efficiency notjust in the full information set up a well known family of adverse selection models in the stiglitz and weiss 1981 tradition demonstrates that when banks are imperfectly informed about the riskiness of borrowers projects and therefore cannot discriminate against risky borrowers interest rates become inefficiently high and worthy borrowers are driven out of the credit market the extent of this problem is substantially magnified when borrowers do not have adequate collateral to secure a loan typically adverse selection combined with lack of collateral leads to prohibitively high interest rates poorly endowed individuals e g students immigrants the unemployed and a vast majority of poor individuals in developing countries often face such high rates and therefore cannot take advantage of profitable investment opportunities a peer group formation system represents a possible solution to the above problem under this system a bank lends to borrowers without collateral on condition that the borrowers organise themselves into groups and that participant borrowers within each group accept to take joint responsibility for a loan thus in addition to repaying their own share of the loan each group member must accept to repay the obligations of their defaulting peers otherwise the entire group is denied access to future refinancing systems of this kind have been very successful in practice they have generated lower interest rates for the rural poor in for example bangladesh the philippines bolivia and the state of arkansas in the united states moreover group lending has also been successfully implemented in large urban areas such in the cities of dhaka and chicago 1

international coordination of trade and domestic policies the past half century has seen a dramatic multilateral reduction in tariff barriers under general agreement on tariffs and trade gatt negotiations however as tariff barriers have fallen attention has shifted to the use of domestic policies as secondary trade barriers a primary concern is that as countries sign trade agreements that constrain their ability to pursue trade goals through trade policy there will be unilateral incentives for governments to distort their domestic policies as a secondary means of protection 1 increasingly international trade disputes revolve around a country s use of internal regulations as a means of restricting trade the united states has successfully challenged the system of liquor taxes in both japan and korea as discriminating against imported liquor while venezuela and brazil have challenged american standards for reformulated and conventional gasoline as trade protection masquerading as environmentalism gatt contains several articles concerning the international regulation of domestic policies but the question of how to fully incorporate domestic policies within gatt negotiations and other international trade agreements remains contentious indeed at both the ministerial meeting in 1994 at the close of the uruguay round and the recent unsuccessful ministerial conference in seattle many gatt delegates renewed demands for the relationship between trade and various domestic policies e g environmental policy labor standards or competition policy to be examined despite the importance that has recently been placed on international cooperation over domestic policies no theoretical basis exists for considering how to cooperate over both trade and domestic policies within an international agreement previous papers on negotiation over two instruments of protection e g copeland 1989 1990 thomas l hungerford 1991 have assumed asymmetric limitations on cooperation i e they assume that one of the two instruments is either nonobservable or nonnegotiable this paper extends such work by investigating cooperation over two negotiable instruments of protection under symmetric limitations on cooperation and provides insight into the design of international trade agreements that incorporate cooperation over domestic policies i adopt the view that enforcement issues are central to the understanding of international cooperation one of the challenges of international cooperation is the absence of a central authority to enforce the terms of an agreement without access to an external enforcement mechanism international agreements are viable only as long as member countries view continued cooperation to be in their own self interest i e the benefits from cooperating outweigh the potential gains from cheating 2 while the gatt department of economics university of miami p o box 248126 coral gables fl 33124 e mail ederington miami edu i would like to thank bob staiger bob baldwin wolfgang keller phillip mccalman jenny minier seminar participants at the nber conference on trade the environment and natural resources and two anonymous referees for comments on earlier versions of this paper any remaining errors are of course my own for example brian r copeland 1990 examined negotiation over one trade barrier leaving a secondary trade barrier e g nontariff barriers domestic legislation etc to be set noncooperatively he shows that trade liberalization will induce substitution toward the less efficient nonnegotiable instrument of protection due to the unilateral incentives to maintain trade protection facing countries thus within a cooperative framework the two types of barriers serve as imperfect substitutes for each other 2 as stated by kenneth w dam in his review of the gatt institution the best guarantee that a commitment of any kind will be kept particularly in an international setting where courts are of limited importance and even more important marshals and jails are nonexistent is that the parties continue to view adherence to their agreement in their mutual interest thus the gatt system unlike most legal systems is not designed to exclude self help in the form of retaliation rather retaliation subjected to established procedures and kept within prescribed bounds is made the heart of the gatt system dam 1970 pp 80 81

relating the environmental impact of consumption to household expenditures an input output analysis in this paper we evaluate the relationships between household expenditures and the environmental impact categories climate change acidification eutrophication and smog formation by combining household expenditures with environmentally extended input output analysis expenditure elasticities are examined with regression analysis and are compared and interpreted on the basis of insight at the product level with data from the netherlands in the year 2000 we find that environmental impact increases with increasing household expenditures although the degree to which the environmental impact increases differs per impact category climate change and eutrophication increase less than proportionally with increasing expenditures acidification increases nearly proportionally with increasing expenditures whereas smog formation increases more than proportionally it appears that the mix of necessities and luxuries to which an environmental impact is related is essential in explaining the relationship

the microfinance promise in the past decade microfinance programs have demonstrated that it is possible to lend to low income households while maintaining high repayment rates even without requiring collateral the programs promise a revolution in approaches to alleviating poverty and spreading financial services and millions of poor households are served globally a growing body of economic theory demonstrates how new contractual forms offer a key to microfinance success particularly the use of group lending contracts with joint liability for the most part however high repayment rates have not translated into profits and studies of impacts on poverty yield a mixed picture in describing emerging tensions the paper highlights the diversity of innovative mechanisms beyond group lending contracts the measurement of financial sustainability the estimation of economic and social impacts the costs and benefits of subsidization and the potential to reduce poverty through savings programs rather than just credit the promise of microfinance has pushed far ahead of the evidence and an agenda is put forward for addressing critical empirical gaps and sharpening the terms of policy discussion

group lending repayment incentives and social collateral abstract in this paper we investigate the impact on repayment rates of lending to groups which are made jointly liable for repayment this type of scheme especially in the guise of the grameen bank in bangladesh has received increasing attention we set up and analyze the repayment game which group lending gives rise to our analysis suggests that such schemes have both positive and negative effects on repayment rates the positive effect is that successful group members may have an incentive to repay the loans of group members whose projects have yielded insufficient return to make repayment worthwhile the negative effect arises when the whole group defaults even when some members would have repaid under individual lending we also show how group lending may harness social collateral which serves to mitigate its negative effect

understanding developing country stances on post 2012 climate change negotiations comparative analysis of brazil china india mexico and south africa abstract an essential issue in future climate negotiations is how to bring developing countries on board this paper proposes and applies the two level interest based model to analyze the factors that affect the likely stances of the plus five countries brazil china india mexico and south africa on international climate negotiations this study finds mitigation capability to be a crucial factor which consists of at least such sub factors as per capita income energy endowment and economic structure while ecological vulnerability does not seem to play an important role which includes reductions in agricultural outputs sea level rise climate related natural disasters and others the paper proposes six options in an ascending order of stringency that the plus five are likely to adopt the paper suggests that the basic four the plus five excluding mexico particularly china and india are less likely to adopt a voluntary commitment to an emissions cap on the national economy in the near future than mexico which has the highest mitigation capability among all five the basic four are likely to adopt more stringent climate polices with increasing mitigation capabilities suggesting the importance of effective international financial and technology transfer mechanisms and further tighten emission reduction targets from developed countries

permit trading merely an efficiency neutral redistribution away from climate change victims in this paper we present a climate policy game with international emissions trading where governments first select their amounts of emissions permits these permits are transferred to firms and then traded competitively on an international market compared with a game without trading we find that the potential efficiency gains from permit trading which have been identified in other studies are totally undone if governments also employ a tax or subsidy on domestic emissions the only effect of permit trading in this case is a redistribution of income away from those most affected by climate change

policies and international trade agreements on technical compatibility for industries with network externalities abstract the paper considers a country home in which consumers have heterogeneous preferences over ex ante incompatible domestic and imported products and benefit from a network externality we analyze the cases with trade under perfect competition and the international duopoly in which both governments strategically use policies toward compatibility but cannot use conventional trade policies in both cases the equilibrium outcome of the non cooperative game depends upon the strength of the network externality effect and involves either an excessively high equilibrium level of compatibility in combination with either too much or too little trade or very low equilibrium levels of both compatibility and trade the paper concludes with the analysis of the international agreements on policies toward compatibility and evaluates the existing provisions in the wto legal system aimed at minimizing the trade inhibiting impact of standards and regulations in the area of technical compatibility

backward stealing and forward manipulation in the wto abstract motivated by the structure of wto negotiations we analyze a bargaining environment in which negotiations proceed bilaterally and sequentially under the most favored nation mfn principle we identify backward stealing and forward manipulation problems that arise when governments bargain under the mfn principle in a sequential fashion we show that these problems impede governments from achieving the multilateral efficiency frontier unless further rules of negotiation are imposed we identify the wto nullification or impairment and renegotiation provisions and its reciprocity norm as rules that are capable of providing solutions to these problems in this way we suggest that wto rules can facilitate the negotiation of efficient multilateral trade agreements in a world in which the addition of new and economically significant countries to the world trading system is an ongoing process

disguised protectionism global trade rules and alien invasive species current international law strongly favors policies designed to make imports safer e g in terms of invasive species over policies explicitly designed to discourage imports we show that this preference may be counterproductive a externality in trade is incorporated into a political economy model of policy formation nations can address the externality by inspecting cargo and imposing a fine on contaminated imports we compare the equilibrium when inspection is the only policy option relative to the equilibrium that emerging when nations may also manipulate the tariff ruling out the tariff causes socially excessive stringency in general social welfare losses if domestic supply is highly inelastic and in some circumstances an increase in the real tariff measured as the difference between world and domestic prices

domestic support and border measures for processed horticultural products in horticultural markets trade barriers often apply to the processed products whereas domestic support applies to farm produced raw commodities here we assess the effects of such trade barriers and domestic support by simulating the effects of policy reform on global processing tomato markets which are faced with modest processed product tariffs and high domestic support in the european union eu both protection and eu subsidy drive down world welfare but we find that reducing import tariffs for tomato products would yield greater effects on markets and larger welfare impacts outside europe than would reductions in eu domestic support copyright 2008 oxford university press

nontrade concerns reconciling domestic policy objectives with freer trade in agricultural products since the conclusion of the uruguay round of trade negotiations in 1994 there has been increasing debate about the implications of freer trade for domestic or nontrade objectives in agriculture these range from traditional concerns such as food security and rural development to more recent issues such as the relationship between agriculture and the environment and the effects of agricultural practices on human health and animal welfare for countries reluctant to reduce agricultural protection a key issue is the extent to which domestic policy objectives would need to be sacrificed under freer trade for countries espousing trade liberalization the issue is whether domestic policy objectives will be used as a guise to undermine freer trade in agricultural products in this paper we focus on two areas of concern that are stressed by rich developed countries the linkage between agriculture and the environment and animal welfare environmental issues are prominent in asia europe and increasingly in north america while animal welfare is a major issue in europe it is generally acknowledged that agricultural support provided through implicit consumer taxes and direct subsidies in developed countries generates much of the distortion in global agricultural trade the more than 300 billion of agricultural support that is provided annually by oecd countries disadvantages developing country exporters and causes distortions in importers ensuring that there are effective disciplines on trade distorting forms of support will be vital to the suc

north south trade and industry specific pollutants abstract this paper investigates the production and pollution patterns arising from trade between high and low income countries when firms discharge industry specific pollutants we extend the common pollutant model of copeland and taylor north south trade and the environment quart j econ 109 1994 755 787 to incorporate industry specific pollutants and obtained a diversified equilibrium which differs markedly from the complete specialization equilibrium obtained in the original model with diversified production individual countries shares of production and emissions change in a flexible manner reflecting the competitiveness of their products in the world market this result makes it easier for empirical studies to test the theoretical relationships between industrial production emissions and the different attributes of countries including income and factor endowment despite the striking difference in the equilibrium patterns of production and emissions the prediction of the pollution haven hypothesis is retained and pollution intensive industries relocate to south finally a composite of pollutants weighted by disutilities increases in south and decreases in north

is the wto passe the wto has delivered policy outcomes that are very different from those likely to emerge out of the recent wave of preferential trade agreements ptas should economists see this as an efficient institutional hand off where the wto has carried trade liberalization as far as it can manage and is now passing the baton to ptas to finish the job this paper surveys a growing economics literature on international trade agreements and argues on this basis that the wto is not passe rather and subject to some caveats this survey of research to date suggests that the wto warrants strong support while a more cautious view of ptas seems appropriate

the effects of carbon taxation in china an analysis based on energy input output model in hybrid units abstract this paper evaluates the economy wide effects of carbon taxation in china to this end we build a price model based on an energy input output table in hybrid units that ensures the consistency of the analysis the results indicate that carbon taxation has small negative impact on gdp there are however relatively substantial emissions reductions to explore whether the impacts are spatially blind in the sense of having similar impacts on urban and rural residents the results of the distributional effects show that the impacts of carbon taxation on different urban household groups reveal small differences and are slightly regressive yet for rural residents carbon taxation may be significantly regressive in addition rural residents are found to be affected much more than urban residents furthermore the paper explores a policy intervention to investigate the effects of redistributing the carbon tax paid by households the main results reveal that reallocating the carbon tax to the groups with low income levels can offset the negative distributional effects significantly moreover the results of miyazawa style interrelational income multiplier analysis indicate that the household groups with high income would benefit significantly from the income increases in those with low income levels but not vice versa

the sacrifices of micro borrowers in ghana a customer protection perspective on measuring over indebtedness this article measures the over indebtedness of micro borrowers it defines over indebtedness from a customer protection perspective based on the borrowers sacrifices we analyse the sacrifices borrowers experience and find that 30 per cent of borrowers are over indebted we then test risk management indicators of debt problems as predictors of over indebtedness over indebtedness is strongly related to delinquency and the debt to income ratio but not to debt amounts or to multiple borrowing although our model correctly predicts 72 6 per cent of cases even the best indicators identify only a few over indebted borrowers risk management is not enough to protect customers against over indebtedness but the industry needs to measure customer experiences directly

how important are tariffs and nontariff barriers in international markets for fresh fruit international markets for agricultural products are often subject to a range of trade barriers and horticultural products are no exception this article examines the economic implications of tariffs and sanitary and phytosanitary sps regulations that are applied to global markets for fresh apples and fresh oranges we calculate regional level tariff rates and ad valorem equivalents for sps barriers following the price wedge approach a simulation model is developed and used to assess the price quantity and welfare implications of reducing tariffs removing sps barriers and removing sps barriers that have been identified as a specific trade concern stc by the world trade organization results suggest that a 36 reduction in global tariffs would lead to greater welfare gains than would the elimination of sps measures in apple markets however in orange markets we find that sps measures have much larger economic implications for producers and consumers here a 36 reduction in tariffs would lead to smaller overall welfare effects compared to removal of all sps measures and only slightly larger effects than those from removal of stcs alone

time consistent export quotas in an oligopolistic world market abstract we investigate the strategic behavior between exporting countries that face endogenous terms of trade on the world market in a non cooperative setting if production decisions occur before consumption decisions the ex ante optimal export quota is not time consistent as the ex post elasticity of the residual foreign import demand curve is lower than the ex ante elasticity however we show that the exporters inability to irrevocably commit to their quota may be welfare superior to the precommitment solution if exporters can sell forward a proportion of their exports before production decisions are made they will do so even though in equilibrium it may decrease welfare compared to a situation in which forward markets do not exist moreover the equilibrium with forward markets is welfare inferior to the commitment equilibrium for exporters

loan officers gender and microfinance repayment rates this study examines the impact of loan officer characteristics on repayment rates of microfinance borrowers in mexico applying multilevel analyses with special attention to the impact of the gender of the loan officer on default rates the results strongly suggest that loan officers play a crucial role in improving repayment rates in microfinance and that male loan officers are better able to induce borrowers to repay than female loan officers this may be because men exert authority over women and face fewer problems working late travelling through unsafe places and combining a position as counsellor with enforcing repayment

trade policy cross border externalities and lobbies do linked agreements enforce more cooperative outcomes abstract we analyze whether linking international cooperation in trade policy to environmental policy or other issues with nonpecuniary externalities promotes more cooperation in both policies or whether cooperation in one is strengthened at the expense of the other in the context of self enforcing agreements we show that if the policies are independent in the government s objective function then linkage promotes cooperation in one policy at the expense of the policy that is easier to enforce under no linkage however if the linked policies are not independent and if these policies are strategic complements then linkage can sustain more cooperation in both issues than no linkage the policies are strategic complements only if i the production externality has cross border effects ii the weight on the externality cost is high iii import competing lobbies are not powerful

globalisation and values this paper discusses a central element in globalisation debate little addressed by economists namely the interactions at global national and community levels between globalisation and societally based values social values refer to wider notions of collective identity religious values attitudes towards materialism moral beliefs and a sense of collective awareness and are a broader and more encompassing concept than social capital discussed in recent economics and sociology literature social capital relates to trust honesty and the social fabric of accepted norms central to the successful implementation of individual optimising decisions and denotes a communal asset reflecting strength of joint collective commitment whose amount can be increased or improved upon through investment of time and resources social values are much discussed in sociological literature going back to comte durkheim parsons and others the issues taken up here are how different social values might interact and change as societies and their economies integrate globalise processes of value competition displacement and joint assimilation occur naturally to economists but seem little studied by sociologists who seemingly place less stress on analytical comparative statics scenarios for how values can interact under globalisation are discussed in the text

the effect of social capital on group loan repayment evidence from field experiments an important question to microfinance is the relevance of existing social capital in target communities to the performance of group lending this research presents evidence from field experiments in south africa and armenia in which subjects participate in trust and microfinance games we present evidence that personal trust between group members and social homogeneity are more important to group loan repayment than general societal trust or acquaintanceship between members we also find some evidence of reciprocity those who have been helped by other group members in the past are more likely to contribute in the future during the past decade exploring the role that social capital plays in economic behaviour has emerged as one of the most fascinating and fertile areas of economic research although precise definitions of social capital are notoriously difficult to pin down one of the early pioneers of the concept coleman 1988 defines social capital as social structure that facilitates certain actions of actors within the structure in his definition coleman specifically highlights the roles of mutual obligation expectations and trustworthiness social norms social sanctions and the transmission of information important studies in both developed and developing countries have analysed the impact of social capital in economic relationships putnam s celebrated work making democracy work civic traditions in modern italy 1993 and bowling alone america s declining social capital 1995 brought attention to the role that social capital plays in the development of the modern state udry s ground breaking 1994 work in nigeria illustrated how the social capital existing in traditional societies may allow for more efficient credit contracts than in developed economies with weaker social

tariffs and the adoption of clean technology under asymmetric information this paper examines the effect of a tariff on the decision of a foreign monopolist to adopt clean technology which reduces the flow of a negative cross border externality the clean technology increases the marginal cost of production relative to the dirty technology but only the firm knows the extent of the increase under complete information despite its protectionist motivation the importing country s optimal tariff induces the firm to adopt the clean technology if and only if it is globally efficient to do so under incomplete information this efficiency property is disrupted and the firm biases its choice in favour of dirty technology jel classification f13 f18 ce memoire examine l effet d un tarif douanier sur la decision d un monopoleur etranger d adopter une technologie qui reduise le flux d effets externes negatifs a travers la frontiere la technologie propre accroit le cout marginal de production par rapport a ce qu il serait avec une technologie salissante mais seule l entreprise connait la taille de cet accroissement en regime d information complete malgre ses motivations protectionnistes le tarif optimal du pays importateur entraine l entreprise a adopter la technologie propre si et seulement si c est globalement efficient de le faire en regime d information incomplete cette propriete est perturbee et l entreprise tend a faire ses choix en faveur de la technologie salissante

the distributional effects of emissions taxation in brazil and their implications for climate policy abstract the emission of greenhouse gases ghg generated by human activity is a major cause of global warming and climate change there is considerable debate about the choice of the best mechanism to reduce emissions under a climate policy the aim of this paper is to measure the impact of a policy of taxing ghg emissions on the brazilian economy as a whole and on different household groups based on income levels in 2009 the following databases were used supply and use tables household budget survey national household sample survey and emissions data from the brazilian ministry of science and technology and innovation a price system from a national input output model that incorporates the intensity of ghg emissions is used as well as a consumption vector broken down into ten representative households with different income levels the main results indicate that this taxation system was slightly regressive and had a small negative impact on output there were however significant emissions reductions

domestic policies in self enforcing trade agreements abstract if all cross country externalities travel through the terms of trade efficient trade agreements may simply target the terms of trade and ignore domestic policies this argument has been advanced by several prominent studies simply put it reads terms of trade agreements are efficient i show that this result breaks down if the following two standard conditions are met first a self enforcement requirement constrains the agreement and second production possibilities are intertemporally linked these conditions imply that a country s current policy mix affects future production possibilities and thus impacts payoffs under potential defection since a terms of trade agreement does not specify a country s policy mix it effectively invites countries to manipulate their own defection temptation to be self enforcing terms of trade agreement must ensure that no country while optimizing its policies on the iso terms of trade schedule will abandon its zone of voluntary cooperation this requirement implies that terms of trade agreements are inefficient and can be improved upon by agreements that target policies directly

a comparative institutional analysis of agreements on product standards abstract the wto and the eu have chosen two different agreements on product standards while the wto s approach is primarily based on a national treatment nt principle the eu s approach crucially relies on a principle of mutual recognition mr this paper offers a first look at the comparative performance of these two principles we show that standards are imposed for levels of externalities that are too low under nt and too high under mr this suggests that nt should be preferred to mr when the amount of trade in goods characterized by high levels of externalities is large

wto tariff commitments and temporary protection complements or substitutes abstract there is a long held notion in the trade policy literature that traditional tariff instruments and temporary protection tp measures are substitutes despite this prediction there is only mixed empirical evidence for a link between tariff reductions and the usage pattern of antidumping safeguard and countervailing duties based on recent theoretical advances i argue in this paper that the relevant trade policy margin for implementing tp measures is instead tariff overhangs the difference between wto bound and applied tariffs lower tariff overhangs constrain countries to raise their mfn applied rates without legal repercussions independent of past tariff changes using detailed sectoral data for a sample of 30 wto member countries during the period 1996 2014 i find strong evidence for an inverse link between tariff overhangs and tp activity this result implies that tariff overhangs and tp measures are substitutes vindicating the importance of existing tariff commitments as a key determinant of alternative protection instruments

the race to the bottom from the bottom the dominant perspective in discussions of labour and environmental standards and globalization is that of north south competition and its impact on northern standards this paper presents an alternative perspective that of south south competition to export to the north and its impact on southern standards it develops a simple model of southern competition and demonstrates that whether a southern race to the bottom is possible depends intricately on the northern demand curve the size of large exporters relative to each other and the relative size of the competitive fringe of small exporters the possibility that northern trade protectionism may undermine southern standards is also examined

data envelopment analysis of different climate policy scenarios abstract recent developments in the political scientific and economic debate on climate change suggest that it is of critical importance to develop new approaches able to compare policy scenarios for their environmental effectiveness their distributive effects their enforceability their costs and many other dimensions this paper discusses a quantitative methodology to assess the relative performance of different climate policy scenarios when accounting for their long term economic social and environmental impacts the proposed procedure is based on data envelopment analysis here employed in evaluating the relative efficiency of eleven global climate policy scenarios the methodology provides a promising comparison framework it can be seen as a way of setting some basic guidelines to frame further debates and negotiations and can be flexibly adopted and modified by decision makers to obtain relevant information for policy design three major findings emerge from this analysis i stringent climate policies can outperform less ambitious proposals if all sustainability dimensions are taken into account ii a carefully chosen burden sharing rule is able to bring together climate stabilisation and equity considerations and iii the most inefficient strategy results from the failure to negotiate a post 2012 global climate agreement

national treatment in the gatt the national treatment nt clause is the first line defense in the gatt and in most other trade agreements against opportunistic exploitation of the inevitable incompleteness of the agreement this paper examines the role of nt as it applies to internal taxation under the gatt it is shown that despite severely restricting the freedom to set internal taxes nt may improve government welfare but it will not completely solve the incomplete contract problem it is meant to remedy furthermore it requires a high degree of economic sophistication on behalf of trade negotiators in order for this beneficial effect to materialize

microfinance in times of crisis the effects of competition rising indebtedness and economic crisis on repayment behavior this paper analyzes repayment determinants for loans from caja los andes a bolivian mi crolender the analysis focuses on the influence of recent changes in the bolivian microfinance market in particular we examine the effects of the rapidly growing supply of funds for micro loans the increasing competition a rising level of indebtedness among micro entrepreneurs and the recent economic crisis our results show a two fold influence structure of competition and indebtedness firstly clients with loans from multiple sources at the same time are found to be more likely to default than others secondly clients with given characteristics have an overall better repayment behaviour in areas with higher competition and a higher supply of micro loans

profit shifting and trade agreements in imperfectly competitive markets profit shifting and trade agreements in imperfectly competitive markets do new rationales for trade agreements arise once imperfectly competitive markets are allowed we consider several trade models that feature imperfectly competitive markets and argue that the basic rationale for a trade agreement is in fact the same rationale that arises in perfectly competitive markets in all of the models that we consider and whether or not governments have political economic objectives the only rationale for a trade agreement is to remedy the inefficient terms of trade driven restrictions in trade volume we also show that the principles of reciprocity and nondiscrimination continue to be efficiency enhancing in these settings

trade agreements with domestic policies as disguised protection abstract wto rules prohibit disguised protection in the form of domestic policies how then do governments cooperate over trade and domestic policies when none can verify whether a nation s domestic tax reduction is a protective measure or a reaction to a production externality in this paper each government privately observes whether a production externality associated with its import competing good is high or low this paper finds that in an optimal agreement disguised protection with domestic policies is never used by governments with a high externality and is never commonly realized moreover in an optimal agreement tariffs may be conditional on domestic policies

optimal international agreement and restriction on domestic efficiency the wto s strict treatment of domestic subsidies has not been well received in the existing literature an essential reason is that the consequent restriction on domestic efficiency is hardly compatible with the existing theory of government intervention under which the primary objective of using domestic subsidies domestic efficiency is not sacrificed for another objective we develop a trade agreement model in which the magnitude of a legitimate domestic subsidy with which to address a production externality is private information we find that an optimal agreement substantially restricts domestic efficiency for the international objective of expanding market access

a dynamic theory of resource wars we develop a dynamic theory of resource wars and study the conditions under which such wars can be prevented our focus is on the interaction between the scarcity of resources and the incentives for war in the presence of limited commitment we show that a key parameter determining the incentives for war is the elasticity of demand our first result identifies a novel externality that can precipitate war price taking firms fail to internalize the impact of their extraction on military action in the case of inelastic resource demand war incentives increase over time and war may become inevitable our second result shows that in some situations regulation of prices and quantities by the resource rich country can prevent war and when this is the case there will also be slower resource extraction than the hotelling benchmark with inelastic demand our third result is that because of limited commitment and its implications for armament incentives regulation of prices and quantities might actually precipitate war even in some circumstances where wars would not have arisen under competitive markets copyright 2012 oxford university press

multilateral trade negotiations bilateral opportunism and the rules of gatt wto abstract trade negotiations occur through time and between the governments of many countries an important issue is thus whether the value of concessions that a government wins in a current negotiation may be eroded in a future bilateral negotiation to which it is not party we identify rules of negotiation that serve to protect the welfare of governments that are not participating in the bilateral negotiation our main finding is that the two central principles of gatt wto nondiscrimination mfn and reciprocity preserve the welfare of nonparticipating governments and therefore offer a first line of defense against bilateral opportunism

trade negotiations domestic policies and the most favored nation clause this paper illustrates how restricting trade instruments to non discrimination links trade agreements to non trade agreements and under certain conditions helps governments further lower tariffs and or domestic standards policies these conditions are i governments objective functions are sufficiently concave with respect to domestic standards policies ii domestic standards are sufficiently valued and iii policies are strategic complements these can then be used as a rationale for restricting safeguard measures to non discrimination ce texte montre comment le fait de restreindre les instruments de politique commerciale a la seule poursuite de liens commerciaux libres de discrimination relie accords commerciaux et non commerciaux et a certaines conditions aide les gouvernements a reduire encore davantage les tarifs douaniers et ou les normes politiques nationales ces conditions sont que i les fonctions objectives soient suffisamment concaves par rapport aux normes politiques nationales ii les normes nationales soient suffisamment valorisees et iii les politiques soient des complements strategiques ces arguments fournissent le rationale pour limiter les mesures de protection a la seule non discrimination

trade agreements and the nature of price determination the terms of trade theory of trade agreements holds that governments are attracted to trade agreements as a means of escape from a terms of trade driven prisoner s dilemma see bagwell and staiger 1999 one of the termsof trade theory s most striking predictions is about the treatment of behind the border policy measures in trade agreements according to this prediction in the noncooperative nash equilibrium from which countries would begin in the absence of a trade agreement tariffs are set inefficiently high but behind the border policies are set at efficient levels hence even in the context of a complex policy environment there is no need for member governments of a trade agreement to negotiate directly over the levels of their behind the border policies rather according to the terms of trade theory the fundamental problem for a trade agreement to solve is to prevent terms of trade manipulation and to thereby reduce tariffs and raise trade volumes without introducing distortions into the unilateral choices of domestic tax subsidy and regulatory policies as a result of the negotiated constraints on tariffs see bagwell and staiger 2001 importantly this result holds for a wide variety of government preferences and has also been shown to hold in imperfectly competitive environments the terms of trade theory of trade agreements therefore provides strong support for shallow integration as the most direct means to solve the policy inefficiencies that would arise absent a trade agreement simply put according to the terms of trade theory negotiations over tariffs alone coupled with an effective market access preservation rule that prevents governments

domestic policies national sovereignty and international economic institutions to what extent must nations cede control over their economic and social policies if global efe ciency is to be achieved in an interdependent world this question is at the center of the debate over the future role of the wto formerly gatt in the realm of labor and environmental standards in this paper we establish that the market access focus of current wto rules is well equipped to handle the problems associated with choices over labor and environmental standards in principle with relatively modest changes that grant governments more sovereignty not less these rules can deliver globally efe cient outcomes i introduction to what extent must nations cede control over their economic and social policies if global efe ciency is to be achieved in an interdependent world at a broad level this question probes the limits of any international economic institution whether geared toward real or e nancial concerns that is designed to promote global efe ciency while respecting national sovereignty naturally the answer depends upon the particular problem that the institution is meant to solve in other words the answer depends upon the inefe ciency that would arise under unilateral policy choices at a more specie c level this question is at the center of the debate concerning the appropriate scope of the world trade organization wto formerly gatt recently member countries have considered ways to broaden the wto s orientation beyond conventional trade policy measures to include labor and environmental standards there are now initiatives to introduce the issue of labor standards directly onto the negotiating agenda of the wto with the purpose of creating a wto social clause the social clause would specify a set of minimum international labor standards and then permit restrictions to be placed against imports from countries not complying with these minimum standards with regard to environmental policies a wto committee on trade and environment has been established to identify the relationships between trade and environmental measures and to

the wto as a mechanism for securing market access property rights implications for global labor and environmental issues can the world trade organization wto contribute to the attainment of sound labor and environmental policies an answer requires an understanding of wto rules we argue that the purpose of wto rules is to create a negotiating forum where governments can exchange secure market access commitments from this perspective we argue that supporters of sound trade labor and environmental policies can benefit from a well functioning wto because facilitating trade liberalization and preventing race to the bottom regulatory chill problems go hand in hand and each is accomplished by maintaining secure property rights over negotiated market access commitments

strategic interaction among nations negotiable and non negotiable trade barriers trade policy is modelled as a two stage game between governments governments choose a negotiable trade barrier in the first stage of the game which is co operative the level of this barrier is treated as a binding commitment in the second stage of the game where the non negotiable trade barrier is chosen non co operatively hence governments choose trade barriers during negotiations with a view to influencing the equilibrium of the non co operative game to follow this proves to be a convenient framework in which to analyse the idea that trade agreements contain loopholes which can be exploited by protectionist governments trade negotiations induce substitution toward less efficient instruments of protection but are nevertheless welfare improving as long as the negotiations are relevant i e the negotiable barrier is actually in use and the two instruments are not perfect substitutes

non spatial government policies and regional income inequality in brazil silveira neto r da m and azzoni c r non spatial government policies and regional income inequality in brazil regional studies this paper uses both macro and micro data to analyse the role of social programmes in the recent reduction in brazilian regional income inequality convergence indicators are presented for different sources of regional income in the period 1995 2006 a decomposition of the gini indicator allows the identification of the role of each of these income sources with respect to the reduction of regional inequality during the period the results point out that both labour productivity and government non spatial policies mainly minimum wage changes and income transference programmes do have a role in explaining regional inequality reduction during the period silveira neto r da m et azzoni c r les politiques gouvernementales non spatiales et l ecart des revenus regionaux au bresil regional studies cet article emploie des donnees a la fois macroeconomiques et microeconomiqu

outreach sustainability and leverage in monitored and peer monitored lending abstract i study the contract design problem facing microfinance lending organizations mfos that want to maximize the impact and outreach of their lending activities to a target population of poor borrowers while remaining financially sustainable tradeoffs between outreach sustainability and financial leverage are shaped by the endogenous monitoring and delegation costs that arise within a chain of agency relationships subject to moral hazard between borrowers loan staff mfo equity owners and outside investors all else equal sustainable mfos that target poorer borrowers must charge higher interest rates have higher staff costs per dollar loaned and are less leveraged analysis of data for 72 mfos tends to support the findings

carbon taxation and market structure a cge analysis for russia abstract russia is one of the world s major sources of carbon based energy as well as one its most intensive users introducing carbon taxes can lead to a reduction in emissions and encourage investment in energy efficiency we investigate the economic effects of carbon taxes on the russian economy under perfect competition and a cournot oligopoly in output markets the main findings are i substituting carbon taxes for labour taxes can yield a strong double dividend in russia however welfare gains strongly depend on the labour supply elasticity and elasticities of substitution between capital labour and energy ii under the assumption of a cournot oligopoly with homogenous products and symmetric firms in the markets for natural gas petroleum and chemical products metals and minerals welfare costs of the environmental tax reform can be higher than under perfect competition this is because introducing carbon taxes leads to a reduction in already sub optimal output thereby exacerbating pre existing distortions arising from imperfect competition iii furthermore increases in energy costs can result in higher mark ups in some markets because of less competition resulting from firms exit

a hitch hiker s guide to post brexit trade negotiations options and principles brexit will require the uk to negotiate new trade arrangements with the eu after summarizing the main options for future uk eu trade relations this article reviews the purpose of trade agreements we highlight that trade negotiations are a bargaining game between countries seeking to reap the gains from international coordination while conceding as little as possible to their negotiating partners this leads us to propose four principles the uk should adopt to guide its trade negotiating strategy i you get what you give ii where negotiations start from matters iii bargain from a position of power and iv invest in negotiating capacity

are co2 taxes regressive evidence from the danish experience abstract denmark today carries one of the heaviest environmental tax burdens in the world bringing in around 10 of public revenues while evaluations have shown that the danish co 2 and other environmental taxes work as an effective measure to reduce emissions a considerable barrier to increased use of these instruments today seems to be a widespread perception of their socially adverse effects in this article it is demonstrated that co 2 taxes imposed on energy consumption in households as well as in industry do in fact tend to be regressive and therefore have undesirable distributional effects this holds especially for taxes imposed directly on households to analyze this we apply national consumer survey statistics in combination with input output tables

poverty and distributional effects of carbon pricing in low and middle income countries a global comparative analysis abstract even though concerns about adverse distributional implications for the poor are one of the most important political challenges for carbon pricing the existing literature reveals ambiguous results for this reason we assess the expected incidence of moderate carbon price increases for different income groups in 87 mostly low and middle income countries building on a consistent dataset and method we find that for countries with per capita incomes of below usd 15 000 per year at ppp adjusted 2011 usd carbon pricing has on average progressive distributional effects we also develop a novel decomposition technique to show that distributional outcomes are primarily determined by differences among income groups in consumption patterns of energy rather than of food goods or services we argue that an inverse u shape relationship between energy expenditure shares and income explains why carbon pricing tends to be regressive in countries with relatively higher income since these countries are likely to have more financial resources and institutional capacities to deal with distributional issues our findings suggest that mitigating climate change raising domestic revenue and reducing economic inequality are not mutually exclusive even in low and middle income countries

asymmetric tax policy responses in large economies with cross border pollution we build a model of cross border pollution between two large open economies one importing the polluting good and the other exporting it and derive their non cooperative trade and environmental tax policies we show among other things that 1 in response to a bilateral reduction in trade taxes by both countries the former country s optimal policy is to lower its nash emissions tax while the latter s is to raise it and 2 in response to an increase in emissions tax rates by both countries the former country s optimal reaction is to raise its nash import tariff while the latter s is to reduce its nash export tax that is in the present context freer trade leads the exporting country to adopt stricter while the importing country laxer environmental tax policies

distributional effects of carbon taxes the case of mexico abstract in this study i develop an analytical general equilibrium model to assess the distributional effects across income groups of a carbon tax assuming that the revenue from the carbon tax is recycled in two different ways as a manufacturing tax cut and a food subsidy i use this analytical model to provide intuition about the main distributional components the model is calibrated with data from mexico to obtain unambiguous price and quantity changes i find that the distribution of the costs is driven by the way the revenue is recycled in particular the costs are distributed regressively when the revenue is recycled as a manufacturing tax cut and progressively when it is recycled as a food subsidy providing a food subsidy also generates higher welfare and lower carbon emissions than the manufacturing tax cut to compare and test the robustness of the numerical findings for mexico i calibrate the model with data for a developed country specifically the u s a despite differences in the magnitude of the changes in some variables the general findings mentioned above also hold for u s a data these results suggest that as found for the u s a in recent studies carbon taxes are not necessarily regressive rather the way revenue is recycled is a major determinant of how the carbon tax costs are distributed

national treatment and the optimal regulation of environmental externalities we analyze the role of national treatment in the regulation of environmental product standards for an open economy a social planner uses product standards to control emissions from the consumption of a traded good we show that whether national treatment of standards interferes with welfare maximizing policy depends on the instruments available to the policy maker consumption or emissions tax and differences in the cost of complying with the standard we also highlight the asymmetric incidence of the domestic and import product standard when taxes are suboptimal this asymmetric incidence can also cause welfare maximizing policy to violate national treatment on analyse le role du principe de traitement identique des entites domestiques ou importees dans la reglementation des normes environnementales dans une economie ouverte un gouvernement utilise des normes pour controler les emissions decoulant de la consommation d un produit transige internationalement on montre que le fait que le traitement identique des normes va ou non interferer avec l objectif poursuivi qui est de maximiser le niveau de bien etre va dependre de l ensemble des instruments disponibles pour l architecte des politiques une taxe sur la consommation ou sur les emissions et des differences dans les couts a encourir pour se conformer aux normes on souligne aussi l incidence asymetrique des normes sur les produits domestiques et importes quand les taxes sont sous optimales cette incidence asymetrique peut faire que la politique qui vise la maximisation du bien etre soit en violation du principe de traitement identique

will international rules on subsidies disrupt the world trading system international disputes over subsidies have become a prominent feature of the world trading system the creation of the world trade organization wto as a successor to the general agreement on tariffs and trade gatt was nearly prevented by disputes in the uruguay round of gatt negotiations over the issue of negotiating disciplines on agricultural subsidies an issue which continues to plague the ongoing doha round of wto negotiations and ongoing disputes over subsidies that violate existing wto rules have led to the largest amount of authorized retaliation in gatt wto history yet despite their evident importance the international rules that govern subsidies have received little formal attention

trade and labour standards will there be a race to the bottom the objective of this paper is to investigate whether international rivalry will lead to a race to the bottom rtb in labour standards we derive the equilibrium levels of labour standards in an environment that is most conducive to a rtb specifically the brander and spencer 1985 model of strategic trade in which each government has an incentive to lower the cost of a domestic firm our analysis suggests that strategic trade considerations do not lead to a rtb in labour standards to the contrary equilibrium labour standards are higher than those in the absence of government intervention in the case where governments are free to choose the rate of an export subsidy labour standards are inefficiently high binding global trade rules that reduce the subsidy rate would move the equilibrium labour standards closer to their efficient level and a prohibition of the subsidy would eliminate the efficiency loss in labour markets

can social cohesion be harnessed to repair market failures evidence from group lending in guatemala the success of group lending in developing countries has been attributed to the ability of the institution to mitigate asymmetric information problems in credit markets previous research has offered a number of explanations for this phenomenon social ties between borrowing group members internal group pressure to repay loans and peer monitoring this research presents empirical tests on borrowing group data from guatemala which indicate that peer monitoring significantly effects borrowing group performance through stimulating intra group insurance group pressure is found to have a small effect in deterring moral hazard while the effect of social ties among members is statistically insignificant

peer monitoring and credit markets a major problem for institutional lenders is ensuring that borrowers exercise prudence in the use of the funds so that the likelihood of repayment is enhanced one partial solution is peer monitoring having neighbors who are in a good position to monitor the borrower be required to pay a penalty if the borrower goes bankrupt peer monitoring is largely responsible for the successful financial performance of the grameen bank of bangladesh and of similar group lending programs elsewhere but peer monitoring has a cost it transfers risk from the bank which is in a better position to bear risk to the cosigner in a simple model of peer monitoring in a competitive credit market this article demonstrates that the transfer of risk leads to an improvement in borrowers welfare

the political economy of non tariff measures over the last decades non tari measures ntms have seen an important upsurge how ever little research has focused on the political economy of non tariff protection and the existing studies are mainly based on a single country or a specific type of measures this paper seeks to fill the gap by empirically evaluating the determinants of ntms in several countries both developed and developing overall results show certain protectionist purposes behind the adoption of ntms this conclusion is reinforced for restrictive measures i e subject to trade concerns but does not hold for non restrictive measures suggesting the legitimate goal of several ntms furthermore transnational lobbying defined as the influence exerted by national business groups during the ministerial conferences the highest authority of the world trade organization wto increases the probability of adopting ntms in both developed and developing countries

on the economic success of gatt wto dispute settlement what features of the dispute settlement process help governments live up to their trade liberalization commitments exploiting data on gatt wto trade disputes initiated and completed between 1973 and 1998 this paper identifies economic and institutional determinants that help defendant governments commit to liberalizing trade we find substantial evidence consistent with the theory that power measures including threat of retaliation by the plaintiff yield credibility to allow defendant governments to live up to their commitments we find only limited evidence however that particular procedural or institutional features beyond the basic gatt wto dispute settlement forum itself contributed to the successful economic resolution of trade disputes

trade disputes and settlement we develop a model of trade agreements with renegotiation and imperfectly verifiable information in equilibrium trade disputes can occur and can be resolved in a variety of ways governments may settle early or trigger a court ruling and in the latter case they may implement the ruling or reach a post ruling settlement the model yields predictions on how the dispute outcome depends on the contracting environment and how it correlates with the optimal contract form we find support for a key prediction of our model using data on the outcomes of actual trade disputes in the general agreement on tariffs and trade world trade organization

group versus individual liability short and long term evidence from philippine microcredit lending groups abstract group liability in microcredit purports to improve repayment rates through peer screening monitoring and enforcement however it may create excessive pressure and discourage reliable clients from borrowing two randomized trials tested the overall effect as well as specific mechanisms the first removed group liability from pre existing groups and the second randomly assigned villages to either group or individual liability loans in both groups still held weekly meetings we find no increase in short run or long run default and larger groups after three years in pre existing areas and no change in default but fewer groups created after two years in the expansion areas

participation and duration of environmental agreements we analyze participation in international environmental agreements in a dynamic game in which countries pollute and invest in green technologies if complete contracts are feasible participants eliminate the holdup problem associated with their investments however most countries prefer to free ride rather than participate if investments are noncontractible countries face a holdup problem every time they negotiate but the free rider problem can be mitigated and significant participation is feasible participation becomes attractive because only large coalitions commit to long term agreements that circumvent the holdup problem under well specified conditions even the first best outcome is possible when the contract is incomplete

erratum to multilateral trade negotiations bilateral opportunism and the rules of gatt wto abstract trade negotiations occur through time and between the governments of many countries an important issue is thus whether the value of concessions that a government wins in a current negotiation may be eroded in a future bilateral negotiation to which it is not party we identify rules of negotiation that serve to protect the welfare of governments that are not participating in the bilateral negotiation our main finding is that the two central principles of gatt wto nondiscrimination mfn and reciprocity preserve the welfare of nonparticipating governments and therefore offer a first line of defense against bilateral opportunism

taxation of multiple greenhouse gases and the effects on income distribution a case study of the netherlands current economic instruments aimed at climate change mitigation focus on co2 emissions only but the kyoto protocol refers to other greenhouse gases ghg as well as co2 these are ch4 n2o hfcs pfcs and sf6 taxation of multiple greenhouse gases improves the cost effectiveness of climate change mitigation it is not yet clear however what the effect is of multigas taxation on the distribution of the tax burden across income groups this paper examines and compares distributional effects of a co2 tax and a comprehensive tax that covers all six ghg of the kyoto protocol the study concentrates on the netherlands in the year 2000 we established tax rates on the basis of marginal abatement cost curves and the dutch policy target the distributional effects have been determined by means of environmentally extended input output analysis and data on consumer expenditures our results show that taxation of multiple ghg improves not only the cost effectiveness of climate change mitigation but also distributes the tax burden more equally across income groups as compared to a co2 tax these findings are relevant for the debate on the role of non co2 ghg in climate change mitigation

tariff bindings and bilateral cooperation on export cartels abstract despite the negative international externalities that they generate export cartels are legal in many countries we use a repeated game approach to analyze cooperation between a low income country lic and its high income country hic trade partner where the hic agrees to prevent its industry from organizing as an export cartel in return for a combination of improved market access i e a tariff reduction and a transfer from the lic if the lic is subject to a tariff binding say because of an existing trade agreement the transfer it pays to the hic increases and the scope for bilateral cooperation declines

the welfare effects and the distributive impact of carbon taxation on italian households in this work the welfare effects and the distributive impact on italian households of the italian carbon tax are calculated the carbon tax has been introduced in italy at the beginning of 1999 asking for smooth increases over a number of years in the prices of most fossil fuels its welfare effects have been calculated using true cost of living index numbers and the compensating variation the parameters have been obtained through estimation of a complete almost ideal demand system using households data from 1985 to 1996 the welfare loss turns out to be quite substantial and affects italian households in a non negligible way but the distribution of welfare losses across different levels of total monthly expenditures does not allow sustaining the regressivity of carbon taxation as the effect becomes bigger as we move up the income distribution this evidence might encourage the use of carbon taxes at least in the transport sector as cost effective instruments of environmental policy especially after the ratification of the kyoto protocol on climate change

screening by the company you keep joint liability lending and the peer selection effect we look at an economic environment where borrowers have some information about the nature of each other s projects that lenders do not we show that joint liability lending contracts similar to those used by credit cooperatives and group lending schemes will induce endogenous peer selection in the formation of groups in a way that the instrument of joint liability can be used as a screening device to exploit this local information this can improve welfare and repayment rates if standard screening instruments such as collateral are unavailable

leontief versus ghoshian price and quantity models the classical demand driven input output model dates back to leontief 24 25 its economically complete opposite the so called supply driven input output model was developed almost forty years ago by ghosh 16 whereas its first application came more than ten years later by augustinovics 1 followed by giarratani 18 the first theoretical reservations were formulated another ten years later by giarratani 19 and oosterhaven 31 140 1 despite these reservations the model came more or less en vogue in the 1980s several applications appeared at best paying only lip service to this earlier critique 10 5 moreover without much reservations the model also entered the major input output textbook 28 317 22 while uncritical generalizations and reiterations appeared in the theoretical literature 8 3 9 then a heavy discussion about the economic underpinning of the supply driven quantity model was initiated by oosterhaven 33 36 21 34 with that debate the enthusiasm to perform downright applications of the supply driven model seems to have diminished literally in the footnotes of that debate the non existence the mathematics and the possible economic interpretation of the dual price version of the supply driven model was discussed 33 34 independently of this discussion davar 9 presented the dual model in extension but did not discuss the economic plausibility of the underlying economic assumptions nor their implications in view of the misinterpretations and misuse of the quantity version of the supply driven model this contribution aims at an early evaluation of its price version that is as complete and as balanced as possible it is well known that the dual version of the regular input output model is used to simulate cost push inflationary processes 26 188 201 7 246 other applications relate to for instance the price effects of pollution abatement 17 effects of rising energy cost 29 and energy price effects in multiregional or in extended interregional models 35 32 of course this dual price version of the leontief model is based on the same stringent standard assumptions of the quantity version and on some heavy additional assumptions that are made for the price version 37 naturally the potential use of the dual of the supply driven model lies in the simulation of demand pull inflationary processes as opposed to the cost push applications of the dual leontief model hence part of our evaluation will be directed toward the question whether such applications are justified from an economic point of view or not our discussion will start in the next section with a brief summary of the leontief quantity and

group lending sequential financing lender monitoring and joint liability abstract we develop a simple model of group lending based on peer monitoring and moral hazard we find that in the absence of sequential financing or lender monitoring group lending schemes may involve under monitoring with the borrowers investing in undesirable projects moreover under certain parameter configurations group lending schemes involving either sequential financing or a combination of lender monitoring and joint liability are feasible in fact group lending schemes with sequential financing may succeed even in the absence of joint liability though the repayment rate will be lower in the absence of joint liability however group lending with lender monitoring is unlikely to be feasible

trade liberalization in the presence of domestic regulations public policies applied to eu and u s wine markets abstractwine is the highest valued product in the agricultural food and beverage sector traded between the united states and the european union eu and wine faces a range of tariffs that are differentiated by country and product category in addition the production of wine grapes is heavily regulated within the eu and there are complicated state level policies in the united states designed to limit the retail availability of wine there continues to be economic and political pressure for reform to the tariffs between the united states and the eu and to the domestic regulations in each region we carefully develop parameters to characterize the effects of tariffs and domestic regulations that affect production and consumption of wine in the two regions simulation results show that reductions in tariffs would have relatively small effects in eu and u s wine markets whereas reductions in eu domestic policies that affect wine grape production would have much larger trade and welfare implications

the development trinity how regional integration impacts growth inequality and poverty developing countries today have become more active participants in regional trade agreements this raises questions about how the benefits of integration are distributed and the extent to which lower income countries are able to capture development gains historically such impacts have been difficult to identify with precision this paper seeks to address this gap by empirically analysing the impact of regional integration on development particularly the effects on growth and welfare using both bilateral and regional integration measures we show that the ability to capture gains from integration varies across developing country regional groups with developing asia benefiting on par with developed countries the findings in the paper indicate that trade and trade policy play an important role in reducing inequality and poverty in developing countries it also shows that regionalism can function as a channel to make multilateralism a more adept way of addressing national challenges