Tariff reforms with rigid wages

Rod Falvey, Udo Kreickemeier

Research output: Chapter in Book/Report/Conference proceedingChapterResearchpeer-review


This chapter analyzes the effects of tariff reforms on welfare and market access in a competitive small open economy that is characterized by involuntary unemployment due to non-market clearing wages that are fixed either in terms of the numeraire or in real terms. We show that recent tariff-reform results can be extended to integrated reforms of tariffs and the wage rate, and that the inherent tension between reforms that increase welfare and market access carries over. We also derive welfare increasing tariff-reform strategies that keep the wage rate constant, and show that this tension may be attenuated.

Original languageEnglish
Title of host publicationInternational Trade and Labor Markets: Welfare, Inequality, and Unemployment
EditorsUdo Kreickemeier
PublisherWorld Scientific Publishing
Number of pages22
ISBN (Electronic)9789813224919
ISBN (Print)9789813224902
Publication statusPublished - 1 Jan 2017
Externally publishedYes

Publication series

NameWorld Scientific Studies in International Economics
ISSN (Electronic)1793-3641


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  • Tariff reforms with rigid wages

    Falvey, R. & Kreickemeier, U., 2009, In: Economic Theory. 41, 1, p. 23-39 17 p.

    Research output: Contribution to journalArticleResearchpeer-review

    Open Access
    12 Citations (Scopus)

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