The Customs Union Issue Reopened
Beginning in 1965, a number of economists put forward the proposition that unilateral tariff reduction is necessarily superior to a customs union. In an earlier paper, the authors provided a specific counterexample showing that this proposition is not correct. This paper addresses the question of how broad the circumstances are under which unilateral tariff reduction is necessarily superior. The authors find that very narrow assumptions have been made by economists to establish unilateral tariff reduction superiority. Thus, a customs union should not be summarily rejected in favor of unilateral tariff reduction. The authors cannot tell whether a customs union will be desirable or undesirable without a detailed analysis. Copyright 1992 by Blackwell Publishers Ltd and The Victoria University of Manchester
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Volume (Year): 60 (1992)
Issue (Month): 2 (June)
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