Optimal Trade Policies for a Developing Country Under Uncertainty
AbstractThis paper investigates optimal trade policies for a developing small open economy which faces international price uncertainty. Trade taxes are used to finance provision of a public good, which enters the utility function of consumers. If demands for private goods are independent of the public good, the optimal composite tariff dominates the optimal quota. If the optimal state-contingent tariff increases with the foreign price, the optimal specific tariff also dominates the optimal quota, regardless of risk aversion. However, the ranking of the optimal specific tariff and the optimal quota generally depends on risk attitudes as well as ordinal preferences.
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Bibliographic InfoPaper provided by International Agricultural Trade Research Consortium in its series Working Papers with number 51263.
Date of creation: 1990
Date of revision:
Other versions of this item:
- Kwan Choi, E. & Lapan, Harvey E., 1991. "Optimal trade policies for a developing country under uncertainty," Journal of Development Economics, Elsevier, vol. 35(2), pages 243-260, April.
- Choi, E. Kwan & Lapan, Harvey E., 1991. "Optimal Trade Policies for a Developing Country Under Uncertainty," Staff General Research Papers 478, Iowa State University, Department of Economics.
- E. Kwan Choi & Harvey E. Lapan, 1991. "Optimal Trade Policies for a Developing Country under Uncertainty," Center for Agricultural and Rural Development (CARD) Publications 90-gatt8, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- E. Kwan Choi & Harvey E. Lapan, 1991. "Optimal Trade Policies for a Developing Country under Uncertainty," Food and Agricultural Policy Research Institute (FAPRI) Publications 90-gatt8, Food and Agricultural Policy Research Institute (FAPRI) at Iowa State University.
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- Choi, E. Kwan & Feinerman, Eli, 1995. "Regulation Of Nitrogen Pollution: Taxes Versus Quotas," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(01), July.
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