HomeDespre ECTAEventsPolitica editorialaTrimite un articolParteneri / link-uri utileArchiveAbonamentContact

ISSN 1841-8678   (print)
ISSN 1844-0029   (online)


Archive ECTAP

Note: for the period 1994-2003 the archive of the magazine will not be available online

Supplements ECTAP

If you cannot open the pdf file you need Adobe Reader.
download Adobe Reader

Creative Commons License

Theoretical and Applied Economics
No. 4 / 2020 (625), Winter

Welfare enhancing uncertainty

Economics Department, Calcutta University, Kolkata, India

Abstract. In this paper it is shown that one of the intrinsic characteristics of the canonical Melitz (2003) type framework is that inclusion of further uncertainties enhances the aggregate welfare of the given economy, though reducing the total varieties available. Here the uncertainty assumed is, payment risk associated with the exchange in international market. The key to such an occurrence is the fact that uncertainty acts like an increased trade costs leading to added exit of low productive firms. Since uncertainty seems to be desirable any efforts to decrease such can be deemed expensive. However, this also proves for a fact that the developing countries with overall lower productivity and higher uncertainty will lose out its import and export share to international competition in the global market.

Keywords: firm heterogeneity, payment uncertainty, welfare.

Download the full article:  


Open acces




The Economicity. The Epistemic Landscape, Marin Dinu, 2016


ISSN 1841-8678 (ediția print) / ISSN 1844-0029 (ediția online)
© Copyright Asociația Generală a Economiștilor din România / Editura Economică
Redacția: Oficiul poștal 18, Ghișeul 3 - Căsuța poștală 31, București 014820, E-mail:

© 2006-2024 Theoretical and Applied Economics