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Wage The payment for the service of a unit of labor, per unit time. In trade theory, it is the only payment to labor, usually unskilled labor. In empirical work, wage data may exclude other compensation, which must be added to get the total cost of employment.
Wage insurance A program to pay displaced workers, when they become re-employed and for a limited period of time, a specified fraction of the difference between their old wage and their lower new wage. As of 2002, the US provides wage insurance to a limited number of workers as part of Alternative Trade Adjustment Assistance.
Wage-price spiral A feedback process in which increasing wages lead, through costs, to increasing prices, while increasing prices lead, through the need to maintain real wages, to increasing wages.
Wage-rental ratio The ratio of the wage of labor to the rental price of either capital or land, whichever is the other factor in a two-factor Heckscher-Ohlin model. The ratio plays a critical role in this model since it determines the ratios of factors employed in both industries.
Waiver An authorized deviation from the terms of a previously negotiated and legally binding agreement. Many countries have sought and obtained waivers from particular obligations of the GATT and WTO.
Walras' Law The property of a general equilibrium that if all but one of the markets are in equilibrium, then the remaining market is also in equilibrium, automatically. This follows from the budget constraints of the market participants, and it implies that any one market-clearing condition is redundant and can be ignored.
Walrasian adjustment A market adjustment mechanism in which price rises when there is excess demand and falls when there is excess supply. Strictly speaking, these excess supplies and demands are those that would obtain without any history of disequilibrium, as with a Walrasian auctioneer.
Walrasian auctioneer A hypothetical entity that facilitates market adjustment in disequilibrium by announcing prices and collecting information about supply and demand at those prices without any disequilibrium transactions actually taking place.
WARP Weak axiom of revealed preference.
Warsaw Pact A "treaty of friendship, co-operation, and mutual assistance" including the Soviet Union and its satellite states in Central Europe. Signed in 1955, it included eight countries.
Washington Consensus A set of economic practices and reforms deemed by international financial institutions (located in Washington, D.C.) to be helpful for financial stability and economic development; often imposed as conditions for economic assistance by these institutions. Phrase coined by John Williamson (1990).
Washington Consensus Mark 2 Name sometimes given to the views expressed by Dani Rodrik and co-authors, who amend or even replace the Washington Consensus with "get the institutions right." See Rodrik et al. (2004).
Wassenaar Arrangement The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies is a cooperative arrangement among a group of countries intended to voluntarily limit access to exports that might enhance the military capabilities of suspect countries. Named after the town in the Netherlands where it was negotiated in December 1995.
Water in the tariff 1. The extent to which a tariff is higher than necessary to be prohibitive.
2. The extent to which an applied tariff is below the bound tariff.
WCO World Customs Organization
Weak axiom of revealed preference The assumption that a consumer who reveals strict preference for one bundle of goods over another will not, in other circumstances, reveal their preference for the second over the first. That is, if qi, qj are the vectors of goods purchased at prices pi, pj respectively, then piqi>piqj  pjqi>pjqj. Used in proving correlation results.
Wealth The total value of the accumulated assets owned by an individual, household, community, or country.
Webb-Pomerene Act US legislation enacted in 1918 exempting certain exporters and exporter associations from anti-trust legislation.
WEF World Economic Forum
Welfare Refers to the economic well being of an individual, group, or economy. For individuals, it is conceptualized by a utility function. For groups, including countries and the world, it is a tricky philosophical concept, since individuals fare differently. In trade theory, an improvement in welfare is often inferred from an increase in real national income.
Welfare criterion A basis, usually quantitative, for judging whether one state of the world or of an economy is better than another, for use in welfare economics and in evaluation of policies.
Welfare economics The branch of economic thought that deals with economic welfare, including especially various propositions relating competitive general equilibrium to the efficiency and desirability of an allocation. See the first and second theorems of welfare economics.
Welfare proposition In trade theory, this usually refers to any of several gains from trade theorems.
Welfare state A set of government programs that attempt to provide economic security for the population by providing for people when they are unemployed, ill, or elderly.
Welfare triangle In a partial equilibrium market diagram, a triangle representing the net welfare benefit or loss from a policy or other change. In trade theory it often means the triangle or triangles representing the deadweight loss due to a tariff.
West African Development Bank Banque Ouest Africaine de Developpement
Western Hemisphere Free Trade Area Name sometimes proposed for a preferential trading arrangement including most or all of the countries of the western hemisphere. Now called FTAA.
WFOE Wholly foreign owned enterprise
WHFTA Western Hemisphere Free Trade Area
White knight An person or firm that attempts to thwart a hostile takeover of another firm, often by offering to acquire it on more favorable terms. In attempted cross-border takeovers, the white knight is usually from the same country as the firm being acquired.
Wholly foreign owned enterprise While logically this term could apply to any foreign-owned enterprise in any country, it is used primarily for such enterprises in China.
Wide band An exchange regime in which the exchange rate is pegged, but the limits of intervention are set further apart than the usual ± one or two percent. Same as target zone.
Willingness to pay The largest amount of money that an individual or group could pay, along with a change in policy, without being made worse off. It is therefore a monetary measure of the benefit to them of the policy change. If negative, it measures its cost.
WIPO World Intellectual Property Organization
Withholding tax A tax on income that is levied at the source, thus diverted to the government before the recipient of the income ever sees it. Used in international tax treaties to assist tax collection.
Worker rights Labor rights.
Working party A group that is delegated to study an issue. Used by the WTO as a first step in considering a new issue that may later become the subject of negotiations.
Working requirement In intellectual property rights, a requirement that a patent, trademark, or copyright be used (a good produced or sold, for example) within a specified time period or else the right will lapse or be subject to compulsory licensing.
World Bank A group of five closely associated international institutions providing loans and other development assistance to developing countries. The five institutions are IBRD, IDA, IFC, MIGA, and ICSID. As of August 2012, the largest of these, IBRD, had 188 member countries.
World Customs Organization The intergovernmental organization, based in Brussels, Belgium, that deals with matters of customs. It develops and promotes global standards and procedures for customs administration.
World Economic Conference 1. A gathering of world leaders in 1927, organized by the League of Nations to stop the rise of protectionism. Nations agreed on a code to limit quantitative restrictions and promised not to raise tariffs. The code was never ratified by enough countries, and the truce ended with the Smoot-Hawley Tariff.
2. A second gathering of world leaders, in London in 1933. Its main concern, at the insistence of US President Roosevelt, was international payments including reparations payments by Germany, and it failed to reach any agreement.
World Economic Forum A self-described "independent, international organization incorporated as a Swiss not-for-profit foundation" that brings together leaders from business, government, academia, and civil society to seek solutions to the world's economic problems.
World Fact Book An excellent source of information about the countries of the world, including basic economic data.
World Intellectual Property Organization The United Nations organization that establishes and coordinates standards for intellectual property protection.
World market See world price.
World Organization for Animal Health Formed in 1924 as Office International des Epizooties, it kept its acronym OIE when it adopted its current name in 2003. It is responsible for "improving animal health worldwide." The WTO's SPS Agreement names OIE as the relevant organization for animal health.
World price The price of a good on the "world market," meaning the price outside of any country's borders and therefore exclusive of any trade taxes or subsidies that might apply crossing a border into a country but inclusive of any that might apply crossing out of a country.
World production possibility frontier The aggregate production possibility frontier for all of the countries of the world. Usually depicted for a two-good, two-country model.
World Trade Organization A global international organization that specifies and enforces rules for the conduct of international trade policies and serves as a forum for negotiations to reduce barriers to trade. Formed in 1995 as the successor to the GATT, it had 155 member countries as of August 2012.
World transformation curve The world production possibility frontier.
WTO World Trade Organization