Field of Research
Overview of Research
I have been conducting theoretical research on the impact of tariff policies on the welfare of countries by analyzing how tariff policies affect the behavior of companies, using a framework in which productivity differs among the companies.
Since traditional trade theory analyzes the effects of tariff policies under the assumption that the productivity of each company is the same, all companies are assumed to engage in exports. However, with the availability of company-level data in the 1990s, an analysis of exporting companies in each industry revealed that only some highly productive companies export. Furthermore, recent empirical studies have shown that the average markup set by companies (the difference between a product’s selling price and cost as a percentage of the cost) has been increasing yearly, driven by a small number of large, highly productive companies. Recent studies used a framework that incorporates these characteristics and revealed that the impact of tariff policies on the behavior of exporting companies in trade partner countries diverges from traditional trade theory models, with substantial differences depending on the productivity of each exporting company.
Recently, I investigated what tariff rates should be imposed on goods traded between countries entering into trade agreements. This analysis, conducted under the aforementioned framework, shows that depending on the goods in question, it may be possible to improve the welfare of the contracting parties by imposing certain tariff rates on trade between them. These findings, obtained by analyzing the tariff policies, take into account the differences in the productivity and pricing behavior of each company. Moreover, the findings may have important implications for unexplored tariff policies.
Degree: Masters of Economics (Osaka University)