Welfare paradox in economic restructuring

It can be proved theoretically that, because of the previously existing price and structural distortion, a welfare paradox is possible in the former command economies during the transition period. This paradox refers to a situation in which a welfare gain is accompanied by a fall in the reported GNP figure.     

Border tax adjustments: Do they distort trade?

A familiar proposition asserting the trade-neutrality of uniform, indirect taxes under both the origin and destination principles is re-examined in the context of a world with trade in intermediate goods. A uniform, general sales tax is shown to be trade-neutral under the destination principle, but trade-distorting under the origin principle. A ‘stage of processing’ value added tax is nondistorting under either border tax adjustment principle. The discussion is then related to a proposed change in GATT rules that would require origin principle administration of the European value added tax.     

Imports as a cause of injury: The case of the U.S. steel industry

This paper develops a method for assessing whether or not imports have been the most significant cause of injury to a U.S. industry. Such a determination is required under the 'escape clause' provisions (Section 201) of the Trade Act of 1974. The method is applied to the case of the U.S. steel industry, which recently petitioned the I.T.C. for import relief. We find that relief is not warranted if the relevant period is taken to be 1976–1983, as specified in the industry's petition. The results are less clear for the shorter period from 1979 to 1983.