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RISK AND ILLEGAL TRADE
Author(s) -
Schöler Klaus
Publication year - 1989
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/j.1467-999x.1989.tb00443.x
Subject(s) - estimation , economics , phenomenon , national economy , international trade , international economics , business , economic system , physics , management , quantum mechanics
In many countries illegal imports have reached a considerable share of all national imports. Therefore, we have to investigate the economic effects resulting from smuggling. This paper explains this phenomenon by means of the managers' different individual attitudes towards risk and their different estimation of the exposure costs of illegal trade. It could be shown that this basis of smuggling is also an important aspect for a national economy, since the relative prices are affected by the risk and cost estimations of the trade firms.