ch34 - Chapter 34 Trade Policy Outline Methods of...

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Chapter 34– Trade Policy Outline Methods of protection o Exercises Legitimate arguments for protection Fallacious arguments for protection Methods of protection Import tariffs or duties are taxes applied to an imported good can be applied in response to unfair actions by foreign firms or governments (e.g. subsidies) raise the price of the imported good and the import competing good by the amount of the tax. raise tariff revenue for the government. cause deadweight loss for importing countries. Voluntary export restraints or import quotas result in reduced imports are enforced by either the importing country (quotas) or the exporting country (VERs). raise the price of both the imported good as well as the import competing good. raise no tariff revenue for the government. increase profits for the foreign sellers
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ch34 - Chapter 34 Trade Policy Outline Methods of...

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