Trade policy Technology | Restricted Trade (Import ban imposed by Portugal) | Free Trade | Benefit from Trade = VT/VR | |||||||
Prod | Cons | Wine Priceb | Total value (VR) | Prod | Cons | Wine Priceb | Total value (VT) | |||
Convex technology | r = 0 s = 1 (Ricardo’s example) | WE: 0.934 CE: 1.080 WP: 1.077 CP: 0.931 | wE: 1.080 cE: 1.080 wP: 0.931 cP: 0.931 | E: 1.20
P: 0.889 | 4.089 | WE: 0 CE: 2.2 WP: 2.125 CP: 0 | wE: 1.141 cE: 1.016 wP: 0.984 cP: 1.184 | E: 1.069
P: 1.069 | 4.472 | 1.093 |
r = −0.1 s = 1 | WE: 0.945 CE: 1.066 WP: 1.065 CP: 0.942 | wE: 1.079 cE: 1.066 wP: 0.931 cP: 0.942 | E: 1.186
P: 0.90 | 4.086 | WE: 0.384 CE: 1.690 WP: 1.666 CP: 0.365 | wE: 1.101 cE: 0.949 wP: 0.950 cP: 1.106 | E: 1.034
P: 1.034 | 4.177 | 1.022 | |
r = −0.3 s = 1 | WE: 0.959 CE: 1.049 WP: 1.049 CP: 0.956 | wE: 1.078 cE: 1.049 wP: 0.930 cP: 0.956 | E: 1.168
P: 0.914 | 4.083 | WE: 0.766 CE: 1.261 WP: 1.252 CP: 0.758 | wE: 1.083 cE: 0.933 wP: 0.935 cP: 1.086 | E: 1.033
P: 1.033 | 4.104 | 1.005 | |
r = −0.5 s = 1 | WE: 0.967 CE: 1.039 WP: 1.039 CP: 0.965 | wE: 1.077 cE: 1.039 wP: 0.929 cP: 0.965 | E: 1.158
P: 0.923 | 4.082 | WE: 0.857 CE: 1.158 WP: 1.153 CP: 0.853 | wE: 1.080 cE: 0.929 wP: 0.931 cP: 1.082 | E: 1.033
P: 1.033 | 4.089 | 1.002 | |
Non-convex technology | r = 0.1 s = 1 | WE: 0.917 CE: 1.10 WP: 1.096 CP: 0.916 | wE: 1.081 cE: 1.10 wP: 0.932 cP: 0.916 | E: 1.222
P: 0.873 | 4.093 | WE: 0 CE: 2.401 WP: 2.310 CP: 0 | wE: 1.240 cE: 1.109 wP: 1.070 cP: 1.292 | E: 1.073
P: 1.073 | 4.881 | 1.192 |
r = 0.3 s = 1 | WE: 0.833 CE: 1.212 WP: 1.185 CP: 0.844 | wE: 1.083 cE: 1.212 wP: 0.934 cP: 0.844 | E: 1.343
P: 0.803 | 4.126 | WE: 0 CE: 3.081 WP: 2.932 CP: 0 | wE: 1.574 cE: 1.423 wP: 1.358 cP: 1.658 | E: 1.085
P: 1.085 | 6.262 | 1.518 | |
r = 0.5 s = 1 | WE: 0 CE: 4.787 WP: 1.952 CP: 0.418 | wE: 1.048 cE: 4.787 wP: 0.904 cP: 0.418 | E: 5.481
P: 0.411 | 6.009 | WE: 0 CE: 4.787 WP: 4.468 CP: 0 | wE: 2.399 cE: 2.211 wP: 2.069 cP: 2.576 | E: 1.106
P: 1.107 | 9.731 | 1.619 | |
r = 0.7 s = 1 | WE: 0 CE: 12.32 WP: 3.048 CP: 0.234 | wE: 1.636 cE: 12.32 wP: 1.412 cP: 0.234 | E: 9.036
P: 0.148 | 13.01 | WE: 0 CE: 12.32 WP: 11.02 CP: 0 | wE: 5.914 cE: 5.693 wP: 5102 cP: 6.630 | E: 1.155
P: 1.155 | 25.05 | 1.926 | |
r = 0.9 s = 1 | WE: 0 CE: 229.6 WP: 28.32 CP: 0.013 | wE: 15.20 cE: 229.6 wP: 13.12 cP: 0.013 | E: 18.13
P: 0.001 | 229.6 | WE: 0 CE: 229.6 WP: 176.1 CP: 0 | wE: 94.52 cE: 106.1 wP: 81.54 cP: 123.5 | E: 1.347
P: 1.347 | 466.7 | 2.032 | |
Scale effects: r = 0, any s > 0 | WE: 0.934 CE: 1.080 WP: 1.077 CP: 0.931 | wE: 1.080 cE: 1.080 wP: 0.931 cP: 0.931 | E: 1.20
P: 0.889 | 4.089 | WE: 1 CE: 1 WP: 1 CP: 1 | wE: 1 cE: 1 wP: 1 cP: 1 | E: 1.069
P: 1.069 | 4.472 | 1.093 |