An increased foreign capital inflow into a protected sector is generally immiserizing. We show that if the protected sector produces an intermediate input, positive welfare effects may emerge. A striking result is that it might lead to an increased import-demand for the intermediate input which...

The concept of factor intensity has played a key role in the development of international trade theory. The factor proportions utilized in the production of commodities differ from activity to activity. Some commodities employ a higher ratio of capital to labor than do others, and the basic...

Credit rationing in the presence of asset inequality affects production and trade pattern in this paper, but not in the conventional way. A Ricardian general equilibrium framework with heterogeneous levels of asset ownership is developed to show that more equal asset distribution may contract...

We analyze the problem of preventing biological invasions caused by ships transporting internationally traded goods between countries and continents. Specifically, we ask the following question: Should a port manager have a small number of inspectors inspect arriving ships less stringently or...

This paper examines the short- and long-term effects of urbanization, via favorable urban development policies, on income distribution and social welfare for a developing country. The urban manufacturing sector is characterized by imperfect competition and free entry. Urbanization shifts rural...

The n total consumers in the market for a particular good are made up of b brown and g green consumers so that b+g=n. The b brown (g green) consumers are not (are) environmentally conscious and hence they prefer to buy a new (remanufactured) good denoted by N and R respectively. By strategically...

We show that the implications of a merger on collusion sustainability change significantly from the extant literature if merger is not profitable in the punishment subgame where firms play non-cooperative Cournot–Nash game. Merger either does not affect collusion sustainability or it may...

This paper introduces finance or credit in the Dixit-Stiglitz-Krugman (DSK) model of international trade. It identifies mechanisms by which finance can affect the main results of the conventional model. The key results are as follows. Perfect credit market does not affect number of varieties or...

Artificial Intelligence (AI) has the potential to significantly impact the income of individuals. Cross-country data shows that introduction of AI is inequality enhancing in developing and less developed countries. In this paper, we attempt to understand the reason for increase in wage...

In this paper, unlike the conventional wisdom, we demonstrate that the relationship between the size of the market and number of firms would be non-monotonic. While moderate rise in the size would force the local firms to exit and only the foreign firm rules, substantial rise in the size would...