Kennan, John; Riezman, Raymond - In: International Economic Review 29 (1988) 1, pp. 81-85
Yes. It is widely believed that tariffs invite retaliation, and that the postretaliation equilibrium l eaves all countries worse off than they would be at free trade. The a uthors present a simple pure exchange model, with two countries and t wo goods, and show which endowment patterns are...