For Whom is MAI? A theoretical Perspective on Multilateral Agreements on Investments



residual MAI is instead impossible, because, when ° < °l, it occurs that ¢E <
0;
when β = °:

A.6 Appendix 6.

We prove here that there exist parameter constellations where countries gain
from participating to a partial MAI compared with what they could get in a
world without MAI. The condition for having a negative value for
μPMZ is

p>

z


βh(1 - βh)     ´ -

h - °)(1 - βh + °) ´ h:


(30)


We see that

@-h
@Ph


°[1 + ° - h(1 - 2βh + °)]0:
[(βh - °)(1 - βh + °)]2


(31)


Recall that by (25) of appendix A.3

P =_______________βt (1 - β*)_______________

z (β* - °)(1 - β* + °)(1 - z) + zβ* (1 - β*) ;

wlicrc 0 — 0:5 β—
where z = 05-βl .


Note that lim p =lim —h =
^*!0:5 βh!!05


---------1--------

4(0:5-°)(0:5+°) .


By evaluating the


total derivative of p with respect to β* = 0:5 we find


@ (P=z)            1 (1 - ι)(1 - ι - °)

(33)


_ _ ...                     --- --- “                                                         :

@β    '■' 0:5      2 (4 - 1 βι +2βι°2 - °2)

Since we are considering a partial MAI equilibrium, by Proposition 4 we need
°l <°<°u . The only ambiguous term in (33) is (1 - l - °), which is
decreasing in
°. Plugging the highest possible value for ° (i.e., °u) into this
term we find

1 - 2βι- -~ 2+6 q21+12β2 - 3oβι;              (34)

which is


always positive for βl < 0:5. It follows that @@p=*z)


j^*=0:5


< 0. So, one


can always choose a pair (°, βι) such that β* < 1=2 and some countries with βh


sufficiently close to 1/2 for which p=z > —h.


25




More intriguing information

1. Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes
2. Stable Distributions
3. Unilateral Actions the Case of International Environmental Problems
4. Business Networks and Performance: A Spatial Approach
5. An Estimated DSGE Model of the Indian Economy.
6. Multifunctionality of Agriculture: An Inquiry Into the Complementarity Between Landscape Preservation and Food Security
7. The name is absent
8. The Role of State Trading Enterprises and Their Impact on Agricultural Development and Economic Growth in Developing Countries
9. Developmental changes in the theta response system: a single sweep analysis
10. The name is absent