STRATEGIC TRADE-POLICY, LEARNING BY DOING EFFECTS AND ECONOMIC-DEVELOPMENT

This paper examines the general equilibrium consequences of temporary and permanent trade policy interventions in circumstances where the pr ice of non-tradeables endogenously adjusts to trade policy changes and where there may be learning-by-doing externality effects in the trade ables goods sector. Using a simple multisector, dynamic model, the pap er demonstrates the difficulties of designing mixed and selective inte rventions such that the ex-post real exchange rate and welfare outcome s are in line with the ex-ante intent. (C) 1997 Elsevier Science Ltd. All rights reserved.