General Equilibrium Approach to Customs Union | International Economics

Jacob Viner's partial equilibrium analysis, based upon trade creation and trade diversion effects, is undoubtedly useful but is only of elementary character. The writers like R.G. Lipsey and J. Vanek have analysed the theory of customs union in the general equilibrium framework. 1. The Lipsey Model of Customs Union: In the partial equilibrium approach, Jacob Viner pointed out that trade [...]