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Voluntary export restraints and foreign investment

Authors
Journal
Journal of International Economics
0022-1996
Publisher
Elsevier
Publication Date
Volume
19
Identifiers
DOI: 10.1016/0022-1996(85)90038-8

Abstract

Abstract This paper develops a model in which both voluntary export restraints (VERs) and foreign investment can be considered. We investigate the welfare effect of additional foreign investment under VERs. It is demonstrated that if the commodity subject to VERs is more intensive in capital in the importing country which is assumed to be a debtor country, additional foreign investment into that country raises its welfare.

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