Hidden Bibliographic Details
| ISBN: | 1484306112
9781484306116
9781484306116
9781484308790
1484308794
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| ISSN: | 1018-5941
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| Notes: | Print version record.
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| Summary: | We study the robustness of the Lerner symmetry result in an open economy New Keynesian model with price rigidities. While the Lerner symmetry result of no real effects of a combined import tariff and export subsidy holds up approximately for a number of alternative assumptions, we obtain quantitatively important long-term deviations under complete international asset markets. Direct pass-through of tariffs and subsidies to prices and slow exchange rate adjustment can also generate significant short-term deviations from Lerner. Finally, we quantify the macroeconomic costs of a trade war and find that they can be substantial, with permanently lower income and trade volumes. However, a fully symmetric retaliation to a unilaterally imposed border adjustment tax can prevent any real or nominal effects.
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| Other form: | Print Version: Linde, Jesper. Macroeconomic Effects of Trade Tariffs: Revisiting the Lerner Symmetry Result. Washington, D.C. : International Monetary Fund,2017 9781484306116
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| Standard no.: | 10.5089/9781484306116.001
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