Publication

This paper examines trade liberalization and its effects on retail market structure, imports and social welfare through the use of a model of trade with heterogeneous retailers. The authors emphasize the importance of studying the degree of pass-through of import into retail prices and the effects of retail market regulation. The paper shows that the degree of pass-through may be large when market structure effects are taken into account, and that restrictions on retailing may have significant effects on imports and the degree of pass-through.