Chapter 6 Student P10

Chapter 6 Student P10 - Chapter 6 The Political Economy of...

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Unformatted text preview: Chapter 6 The Political Economy of International Trade Key Concepts Forms of government intervention The role of the World Trade Organization Accomplishments of the Uruguay Round Goals and challenges in the Doha Round Instruments of Trade Policy Tariffs Subsidies Import Quotas Voluntary Export Restraints Local Content Requirements Administrative Trade Policies Antidumping Policies Tariffs Specific tariffs are levied as a fixed charge for each unit. Ad valorem tariffs are levied as a proportion of the value of the imported good. Export tariffs are taxes placed on a good that is exported from a country. Subsidies Government payments to domestic producers that lower production costs. Cash grants, low-interest loans, tax breaks, or government equity participation Import Quotas Restriction on the quantity of a good to be imported into a country. Can be enacted by issuing import licenses to a limited number of firms. With a tariff rate quota, a lower tariff rate is applied to imports within the quota than those above the quota. Voluntary Export Restraints Quota on trade imposed by exporting country, typically at the request of the importing country. Countries agree to voluntary export restraints to avoid other trade actions. Local Content Requirements Requires some specific fraction of a good to be produced domestically. Requirement can pertain to a minimum percent of component parts or a percent of the value of the good....
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This note was uploaded on 10/22/2010 for the course MGT 302 taught by Professor West during the Spring '10 term at ASU.

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Chapter 6 Student P10 - Chapter 6 The Political Economy of...

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