GROWTH AND WELFARE EFFECTS OF EXPORT SUBSIDIES IN AN ENDOGENOUS GROWTH MODEL

Wataru Johdo

Abstract


The aim of this paper is to examine the welfare impacts of a simultaneous multilateral increase in export subsidies, considering the influence of changes in the growth rate. Firstly, this paper shows that a multilateral increase in export subsidies results in an enhanced world growth rate under some conditions. Subsequently, we show that the welfare effects of export subsidies are contingent upon world growth, transport costs, international relocation of firms and the terms of trade. This paper shows that the economic welfare of each country is enhanced by a simultaneous increase in multilateral export subsidies, under some conditions.

Keywords: Export Subsidy, Growth, Welfare, Location, Transport Costs


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References


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