• Pol Antras


Inequality, Costly Redistribution and Welfare in an Open Economy. Pol Antras, December 10, 2015, Paper. "Trade integration raises real income but often increases inequality and might make some worse off.  Standard approach to demonstrating and quantifying the gains from trade largely ignores trade-induced inequality. Kaldor-Hicks compensation principle. Two basic shortcomings with this approach: 1. How much compensation/redistribution actually takes place? 2. Is this redistribution costless, as the Kaldor-Hicks approach assumes?" Link