| 000 | 01584cam a2200217 4500500 | ||
|---|---|---|---|
| 005 | 20250121114320.0 | ||
| 041 | _afre | ||
| 042 | _adc | ||
| 100 | 1 | 0 |
_aExbrayat, Nelly _eauthor |
| 700 | 1 | 0 |
_a Gaigné, Carl _eauthor |
| 700 | 1 | 0 |
_a Riou, Stéphane _eauthor |
| 245 | 0 | 0 | _aTrade Integration and the Destination of Subsidies |
| 260 | _c2010. | ||
| 500 | _a56 | ||
| 520 | _aIn this paper, we will develop a model of trade and localization, with two countries which differ in productivity levels. Public spending has two possible outcomes: a direct subsidy to immobile households or a wage subsidy to mobile firms. We will show how at the subsidies equilibrium, the country with the higher level of productivity provides firms with a lower after-tax subsidy. Despite this less generous policy, the former country can host a larger share of firms such that its total spending can be higher than in the low-productivity country when trade costs are low enough. Welfare analysis suggests that the second-best optimum requires an increase in subsidy to households in both countries when the economies are weakly integrated, or that the productivity gap is low, and alternatively, a significant portion of capital owners reside outside both economies. | ||
| 690 | _atrade integration | ||
| 690 | _apublic expenditure composition | ||
| 690 | _afirm location | ||
| 786 | 0 | _nRecherches économiques de Louvain | 75 | 4 | 2010-01-21 | p. 407-423 | 0770-4518 | |
| 856 | 4 | 1 | _uhttps://shs.cairn.info/journal-recherches-economiques-de-louvain-2009-4-page-407?lang=en&redirect-ssocas=7080 |
| 999 |
_c546761 _d546761 |
||