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Strategic choice of trade policy instruments

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  • Valentin Melnik

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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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Bibliographic Info

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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