Strategic choice of trade policy instruments

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Strategic choice of trade policy instruments

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Valentin Melnik ()

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Valentin Melnik

Abstract

What is the optimum mix of trade policy instruments? Usually governments choose among such instruments as quotas, tariffs, explicit or implicit subsidies. The goal of the project is to consider the possibility of a simultaneous use by the government of quotas (and corresponding license fees) and tariffs. The combined use of quotas and tariffs is better — from the efficiency point of view — than a policy based on simple quotas or simple tariffs. The qualitative outcomes of the analysis depend on the type of government behavior (revenue or public welfare maximization), and market structure. The study aims at improving our understanding of the link between government intervention — the optimal mix of trade policy instruments — and competition in the home goods market.

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Paper provided by EERC Research Network, Russia and CIS in its series EERC Working Paper Series with number 01-250e.

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Date of creation: 19 Jul 2003
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Handle: RePEc:eer:wpalle:01-250e

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Find related papers by JEL classification:
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies
L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
F00 - International Economics - - General - - - General

This paper has been announced in the following NEP Reports:

NEP-ALL-2004-12-12 (All new papers)
NEP-TRA-2004-12-12 (Transition Economics)

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