Goodtimes.pdf (303.69 kB)
Globalisation as a ‘good times’ phenomenon: a search-based explanation
Globalisation is associated with long periods of sustained economic growth and credit expansion, whereas major recessions tend to lead to falling trade and protectionism. The sensitivity of trade to global economic conditions is not simply driven by policy: rather, in a model of costly search, firms who are engaged in a searching process are very sensitive to changing economic circumstances. In turn, this causes protectionism to be partly endogenous, since optimal noncooperative tariffs can be high during periods when the sensitive, searching firms have exited the market.
History
School
- Business and Economics
Department
- Economics
Publisher
© Loughborough UniversityVersion
- VoR (Version of Record)
Publication date
2009Notes
This is a working paper. It is also available at: http://ideas.repec.org/p/lbo/lbowps/2009_07.htmlISSN
1750-4171Book series
Loughborough University. Department of Economics. Discussion Paper Series;WP 2009_07Language
- en