The welfare effects of international trade with optimistic and pessimistic managers.

This paper investigates the welfare effects of international trade when technological idiosyncratic risk is distorted by optimistic and pessimistic managers. We show that free trade always improves the ex-ante welfare but sometimes lowers the ex-post welfare. Free trade commitment can be regretted ex-post.

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Year of publication:	2004-10
Authors:	Blanchard, Michel ; Peltrault, Frédéric
Institutions:	Université Paris-Dauphine
Subject:	Optimism \| Free trade commitment \| Trade losses \| Idiosyncratic risk

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Extent:	application/pdf
Series:	Open Access publications from Université Paris-Dauphine.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Published in Economics Bulletin (2004-10) v.6, p.1-10
Classification:	F1 - Trade ; D8 - Information and Uncertainty
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008532427