Institution Building without Commitment

• 成果类型: Article
• 署名作者: Bassetto, Marco; Huo, Zhen; Rios-Rull, Jose-Victor
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Minneapolis; Yale University; National Bureau of Economic Research; University of Pennsylvania; Center for Economic & Policy Research (CEPR); University of London; University College London
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20201365
• 发表日期: 2024
• 页码: 3427-3468
• 关键词: collective dynamic choice; political-economy; import competition; Trade agreements; equilibrium; APPROXIMATE; gradualism

摘要

We propose a theory of gradualism in the implementation of good policies, suitable for environments featuring time consistency. We downplay the role of the initial period by allowing agents both to wait for future agents to start equilibrium play and to restart the equilibrium by ignoring past history. The allocation gradually transits toward one that weighs both short- and long-term concerns, stopping short of the Ramsey outcome but greatly improving upon Markovian equilibria. We use the theory to account for the slow emergence of both climate policies and the reduction of global tariff rates. ( JEL C73, E21, E61, F13, H30)