This paper presents a general framework for comparing the effects of tariffs, quotas, and voluntary export restraints both with and without international capital mobility. Expressions for the shadow price of foreign exchange and the shadow price of capital under each type of trade restriction are derived, an d it is shown that, although international capital mobility raises the welfare cost of tariff protection, it lowers the welfare cost of quantitative restrictions. In all cases, the effects of exogenous shocks in the presence of quotas are intermediate betwe en those in the presence of tariffs and those in the presence of voluntary export restraints.
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Volume (Year): 21 (1988) Issue (Month): 4 (November) Pages: 714-35 Download reference. The following formats are available: HTML,
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Handle: RePEc:cje:issued:v:21:y:1988:i:4:p:714-35
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Anderson, James E & Bannister, Geoffrey J & Neary, J Peter, 1995.
"Domestic Distortions and International Trade,"
International Economic Review,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 36(1), pages 139-57, February.
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