Why are safeguards needed in a trade agreement?
By: Meredith A. Crowley
Contributors: Federal Reserve Bank of Chicago. Research Department
Series: Working paper series -- WP-2006-6; Working paper series (Federal Reserve Bank of Chicago. Research Department : Online) -- WP-2006-6.
Publisher: Federal Reserve Bank of Chicago
Published: 2006
Place of publication: Chicago, Ill.]
Language: eng
Format: [electronic resource] /
Subjects: Commercial treaties; Econometric models
Description: "This paper reviews the theoretical and empirical literature on the use of safeguards in a trade agreement. It then analyzes the available data on the use of safeguards by WTO members to examine two hypotheses in the economics literature, that safeguards improve welfare by facilitating tariff reductions and that safeguards improve welfare by providing insurance against adverse economic shocks. I find that countries which undertook larger tariff reductions during the Uruguay Round conducted more safeguards investigations after the WTO was established. However, this result is not robust across all specifications of the model and should not be regarded as definitive. I find no evidence to support the hypothesis that safeguards improve welfare by providing insurance. The empirical analysis rejects the hypothesis of a relationship between safeguards and aggregate uncertainty."--Federal Reserve Bank of Chicago web site.
Notes: Title from PDF file as viewed on 10/12/2006.

Includes bibliographical references.

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Mode of access: World Wide Web.