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Non-Tariff Barriers and Trade Liberalization

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  • Simon P. Anderson

    ()

  • Nicolas Schmitt

    ()

Abstract

This paper shows that governments have no incentive to introduce non-tariff barriers when they are free to set tariffs but they do when tariffs are determined cooperatively. We then show three results. First, with trade liberalization, there is a progression from using tariffs only to quotas, and to antidumping constraints (when quotas are jointly eliminated). Second, there is a narrowing of the range of industries in which each instrument is used. Third,the degree of tariff liberalization and of replacement of tariffs by NTBs depend on industry characteristics.These results are roughly in line with the empirical evidence.

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File URL: http://www.virginia.edu/economics/RePEc/vir/virpap/papers/virpap340.pdf
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Bibliographic Info

Paper provided by University of Virginia, Department of Economics in its series Virginia Economics Online Papers with number 340.

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Length: 35 pages
Date of creation: Jan 2000
Date of revision:
Handle: RePEc:vir:virpap:340

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Web page: http://www.virginia.edu/economics/home.html

Related research

Keywords: Tariffs; Trade Policy; Reciprocal Dumping; Quotas; Antidumping;

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References

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  1. McCulloch, Rachel, 1987. "Why do governments prefer nontariff barriers? A comment on deardorff," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 26(1), pages 217-221, January.
  2. James A. Brander & Paul Krugman, 1983. "A 'Reciprocal Dumping' Model of International Trade," NBER Working Papers 1194, National Bureau of Economic Research, Inc.
  3. Deardorff, Alan V., 1987. "Why do governments prefer nontariff barriers?," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 26(1), pages 191-216, January.
  4. Brander, James A., 1981. "Intra-industry trade in identical commodities," Journal of International Economics, Elsevier, vol. 11(1), pages 1-14, February.
  5. Anderson, S. & Schmitt, N. & Thisse, J.F., 1992. "Who Benifits from Antidumping Legislation?," Discussion Papers dp92-12, Department of Economics, Simon Fraser University.
  6. Kyle Bagwell & Robert W. Staiger, 1988. "A Theory of Managed Trade," NBER Working Papers 2756, National Bureau of Economic Research, Inc.
  7. Cassing, James H. & Hillman, Arye L., 1985. "Political influence motives and the choice between tariffs and quotas," Journal of International Economics, Elsevier, vol. 19(3-4), pages 279-290, November.
  8. James E. Anderson, 1993. "Domino Dumping, II: Anti-dumping," Boston College Working Papers in Economics 219, Boston College Department of Economics.
  9. Kyle Bagwell & Robert W. Staiger, 1995. "Protection and the Business Cycle," NBER Working Papers 5168, National Bureau of Economic Research, Inc.
  10. Baldwin, Robert E., 1984. "Trade policies in developed countries," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 12, pages 571-619 Elsevier.
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  12. Brian R. Copeland, 1990. "Strategic Interaction among Nations: Negotiable and Non-negotiable Trade Barriers," Canadian Journal of Economics, Canadian Economics Association, vol. 23(1), pages 84-108, February.
  13. Falvey, Rodney E & Lloyd, P J, 1991. "Uncertainty and the Choice of Protective Instrument," Oxford Economic Papers, Oxford University Press, vol. 43(3), pages 463-78, July.
  14. James Nieberding, 1999. "The Effect of U.S. Antidumping Law on Firms' Market Power: An Empirical Test," Review of Industrial Organization, Springer, vol. 14(1), pages 65-84, February.
  15. Krishna, Kala, 1989. "Trade restrictions as facilitating practices," Journal of International Economics, Elsevier, vol. 26(3-4), pages 251-270, May.
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  17. Anderson, James E, 1992. "Domino Dumping, I: Competitive Exporters," American Economic Review, American Economic Association, vol. 82(1), pages 65-83, March.
  18. Robert Baldwin & Jeffrey Steagall, 1994. "An analysis of ITC decisions in antidumping, countervailing duty and safeguard cases," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 130(2), pages 290-308, June.
  19. Gallaway, Michael P. & Blonigen, Bruce A. & Flynn, Joseph E., 1999. "Welfare costs of the U.S. antidumping and countervailing duty laws," Journal of International Economics, Elsevier, vol. 49(2), pages 211-244, December.
  20. Rosendorff, B Peter, 1996. "Voluntary Export Restraints, Antidumping Procedure, and Domestic Politics," American Economic Review, American Economic Association, vol. 86(3), pages 544-61, June.
  21. Ray, Edward John, 1981. "The Determinants of Tariff and Nontariff Trade Restrictions in the United States," Journal of Political Economy, University of Chicago Press, vol. 89(1), pages 105-21, February.
  22. Marvel, Howard P & Ray, Edward J, 1983. "The Kennedy Round: Evidence on the Regulation of International Trade in the United States," American Economic Review, American Economic Association, vol. 73(1), pages 190-97, March.
  23. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
  24. Fischer, Ronald D., 1992. "Endogenous probability of protection and firm behavior," Journal of International Economics, Elsevier, vol. 32(1-2), pages 149-163, February.
  25. Moore, Michael O, 1992. "Rules or Politics? An Empirical Analysis of ITC Anti-dumping Decisions," Economic Inquiry, Western Economic Association International, vol. 30(3), pages 449-66, July.
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Citations

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Cited by:
  1. Julia Gray & Jonathan Slapin, 2012. "How effective are preferential trade agreements? Ask the experts," The Review of International Organizations, Springer, vol. 7(3), pages 309-333, September.
  2. Melitz, Marc, 2005. "When and How Should Infant Industries Be Protected?," Scholarly Articles 3228378, Harvard University Department of Economics.
  3. Robert M. Feinberg & Kara M. Reynolds, 2007. "Tariff Liberalisation and Increased Administrative Protection: Is There a Quid Pro Quo?," The World Economy, Wiley Blackwell, vol. 30(6), pages 948-961, 06.
  4. Michael Moore & Maurizio Zanardi, 2011. "Trade Liberalization and Antidumping: Is There a Substitution Effect?," ULB Institutional Repository 2013/136352, ULB -- Universite Libre de Bruxelles.
  5. Pascal Ghazalian & Ryan Cardwell, 2010. "Did the Uruguay Round Agreement on Agriculture Affect Trade Flows? An Empirical Investigation for Meat Commodities," International Advances in Economic Research, Springer, vol. 16(4), pages 331-344, November.
  6. Vives, Xavier, 2005. "Games with strategic complementarities: New applications to industrial organization," International Journal of Industrial Organization, Elsevier, vol. 23(7-8), pages 625-637, September.
  7. Christian Volpe Martincus & Antoni Estevadeordal, 2009. "Trade Policy and Specialization," IDB Publications 9289, Inter-American Development Bank.

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