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Liberalising European steel trade
This paper constructs a simple model of the steel sector in Europe distinguishing eight western and two eastern European regions. It models the production of steel and also the various trade restrictions extant in 1992. It uses this model first to calculate the output and welfare effects of rationalizing the sector to remove the excess capacity experienced in 1992 and second to explore the consequences of the mutual trade liberalization between east and west Europe envisaged under the Europe Agreements. The latter allow major increases in output in the east (18%) and offer western steel users significant welfare benefits (ECU 190 million). Eastern consumers and western producers suffer (smaller) loses, but total output in the EU falls only by about 1.5%.
History
Publication status
- Published
Journal
European Economic ReviewISSN
0014-2921Publisher
ElsevierExternal DOI
Issue
3-4Volume
39Page range
611-621Pages
11.0Department affiliated with
- Economics Publications
Full text available
- No
Peer reviewed?
- Yes