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Optimal Tariffs in the Presence of Middlemen

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  • Lahiri, S.
  • Ono, Y.

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

Paper provided by Institute of Social and Economic Research, Osaka University in its series ISER Discussion Paper with number 0389.

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Length: 17 pages
Date of creation: 1995
Date of revision:
Handle: RePEc:dpr:wpaper:0389

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Keywords: TARIFFS; INTERNATIONAL TRADE; TRADE;

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Cited by:
  1. Gjermund Nese & Odd Straume, 2007. "Industry Concentration and Strategic Trade Policy in Successive Oligopoly," Experimental Economics, Springer, vol. 7(1), pages 31-52, March.
  2. 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.
  3. Marjit, Sugata & Mukherjee, Vivekananda, 2014. "Rent-Seeking and Reform: Relationship Revisited," MPRA Paper 56443, University Library of Munich, Germany.
  4. Yoshiyasu Ono, 2006. "Protective Trade Policies 'Reduce' Employment: A Dynamic Optimization Approach," ISER Discussion Paper 0659, Institute of Social and Economic Research, Osaka University.
  5. Gjermund Nese & Odd Rune Straume, 2005. "Industry Concentration and Strategic Trade Policy in Successive Oligopoly," CESifo Working Paper Series 1439, CESifo Group Munich.
  6. Takauchi, Kazuhiro, 2012. "International R&D Rivalry with a Shipping Firm," MPRA Paper 36843, University Library of Munich, Germany.

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