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Optimal Tariffs in the Presence of Middlemen

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  • Sajal Lahiri
  • Yoshiyasu Ono

Abstract

In this paper, the authors examine the question of optimal tariffs when producers and sellers are different entities. A number of alternative market structures are considered. It is found that the sign of the optimal tariff may depend on the nature of the producer-seller relationship, viz., who the leader is. In particular, the authors find that the optimal tariff is negative when the only seller is the leader and there is only one foreign producer. There is also a case where it is optimal for the government of the home country to subsidize imports no matter who the leader is.

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Bibliographic Info

Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 32 (1999)
Issue (Month): 1 (February)
Pages: 55-70

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Handle: RePEc:cje:issued:v:32:y:1999:i:1:p:55-70

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Cited by:
  1. Yoshiyasu Ono, 2006. "Protective Trade Policies 'Reduce' Employment: A Dynamic Optimization Approach," ISER Discussion Paper 0659, Institute of Social and Economic Research, Osaka University.
  2. Nese, Gjermund & Straume, Odd Rune, 2004. "Industry concentration and strategic trade policy in successive oligopoly," Working Papers in Economics 10/04, University of Bergen, Department of Economics.
  3. Gjermund Nese & Odd Straume, 2007. "Industry Concentration and Strategic Trade Policy in Successive Oligopoly," Experimental Economics, Springer, vol. 7(1), pages 31-52, March.
  4. Shuichi Ohori, 2012. "Environmental Tax and Public Ownership in Vertically Related Markets," Journal of Industry, Competition and Trade, Springer, vol. 12(2), pages 169-176, June.
  5. Marjit, Sugata & Mukherjee, Vivekananda, 2014. "Rent-Seeking and Reform: Relationship Revisited," MPRA Paper 56443, University Library of Munich, Germany.
  6. Takauchi, Kazuhiro, 2012. "International R&D Rivalry with a Shipping Firm," MPRA Paper 36843, University Library of Munich, Germany.

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