VERs and Expectations: Extensions and Evidence

Winters, L. Alan (1999) VERs and Expectations: Extensions and Evidence. Economic Journal, 104. pp. 113-123. ISSN 1468-0297

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This paper analyzes the effects of an expected future voluntary export restraint on the level of firms' current exports to a market. The traditional result that current exports increase is shown to depend on the degree of collusion in the exporting industry and the anticipated restrictiveness of the VER. The former relationship is tested by reference to the effect of EC import surveillance on its imports. Surveillance is argued to indicate an increased probability of a VER in the future, and it is found that while competitive industries respond to it by increasing exports to the EC, less competitive ones curtail exports. This constitutes one of the few empirical tests of the strategic part of strategic trade policy. Copyright 1994 by Royal Economic Society.

Item Type: Article
Schools and Departments: University of Sussex Business School > Economics
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Depositing User: L.Alan Winters
Date Deposited: 06 Feb 2012 18:49
Last Modified: 26 Jun 2012 14:52
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