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Trade Policies for International Competitiveness

Once unquestionably the world’s leading economic and industrial power, the United States now views with growing dismay the impressive industrial efficiency, vigorous work ethics, and large American holdings of various other nations. Is the United States truly lagging in its ability to compete effectively in world markets? Concern over this question has been voiced in both the business and government sectors, as well as by academic economists. A recent conference, sponsored by the National Bureau of Economic Research, explored the effects of trade policies on a nation’s ability to compete in international markets.

In Trade Policies for International Competitiveness, Robert C. Feenstra collects seven papers from the conference, each accompanied by discussants’ comments, and adds a helpful introduction. Some of the issues considered by contributors are effects of macroeconomic and strategic foreign policies on competitiveness; the recent influx of foreign direct investment in the United States, primarily from Japan; the extent to which Japanese trade patterns are a reflection of underlying factor and endowments rather than trade barriers; and the market structure of Canadian industries, including applications for ongoing U.S.-Canadian free trade negotiations. Topical and provocative, these papers will be of value to economists, policymakers, and those in the business world.

272 pages | 14 line drawings, 53 tables | 6.00 x 9.00 | © 1989

National Bureau of Economic Research Conference Report

Economics and Business: Economics--International and Comparative

Table of Contents

Introduction by Robert C. Feenstra
1. Savings Promotion, Investment Promotion, and International Competitiveness
Lawrence H. Goulder and Barry Eichengreen
Comment: David W. Roland-Holst
Comment: Wing Thye Woo
2. The Determinants of Foreign Direct Investment in the United States, 1979-85
Edward John Ray
Comment: Keith E. Maskus
Comment: James Levinsohn
3. Can Interindustry Wage Differentials Justify Strategic Trade Policy?
Lawrence F. Katz and Lawrence H. Summers
Comment: Kenneth A. Froot
Comment: Raquel Fernandez
4. Dynamic Duopoly with Output Adjustment Costs in International Markets: Taking the Conjecture out of Conjectural Variations
Robert Driskill and Stephen McCafferty
Comment: Elias Dinopoulos
Comment: Ronald D. Fischer
5. Differentiated Products, Economies of Scale, and Access to the Japanese Market
Gary R. Saxonhouse
Comment: Laura D’Andrea Tyson
Comment: Harry P. Bowen
6. Export Prices and Exchange Rates: An Industry Approach
Lawrence Schembri
Comment: Alberto Giovannini
Comment: Catherine J. Morrison
7. U.S.-Canada Bilateral Tariff Elimination: The Role of Product Differentiation and Market Structure
Drusilla K. Brown and Robert M. Stern
Comment: Robert W. Staiger
Comment: John Whalley
List of Contributors
Author Index
Subject Index

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