Optimal Markup Responses to Trade Policy Reform in a Small, Open Economy: Evidence From New Zealand

Recent developments in new trade theory have shown that trade liberalization in small open economies can affect terms of trade in imperfectly competitive markets. We use the natural experiment provided by the comprehensive New Zealand economic reforms in the mid 1980's to test this proposition. Using panel data on export unit values from Germany and the United States to several destinations including New Zealand, we find weak evidence for decreased export prices to New Zealand as a result of the reforms.


Issue Date:
Sep 01 1995
Publication Type:
Working or Discussion Paper
Language:
English
Total Pages:
19
JEL Codes:
Fl; F14
Series Statement:
9506




 Record created 2017-09-29, last modified 2017-09-29

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