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Do Tariffs Protect Specific Factors?

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  • Henry Thompson

Abstract

It is shown that a tariff can lower payment to a productive factor used only in (specific to) the protected industry in a simple production model. This may occur anytime the protected sector shares more than one common factor with the rest of the economy, as seems most likely. Intuition based on the well-known specific factors model, where sectors share a single common factor, should be modified. Whether specific factors effectively receive protection from tariffs becomes an empirical issue.

Suggested Citation

  • Henry Thompson, 1989. "Do Tariffs Protect Specific Factors?," Canadian Journal of Economics, Canadian Economics Association, vol. 22(2), pages 406-412, May.
    • Handle: RePEc:cje:issued:v:22:y:1989:i:2:p:406-12
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    Cited by:

    1. Henry Thompson, 2016. "Tariffs and Wages in Trade Theory," Review of Development Economics, Wiley Blackwell, vol. 20(2), pages 399-405, May.
    2. Dogan, Can & Akay, Gokhan H., 2019. "The role of labor endowments on industry output in the short run: Evidence from U.S industries," International Review of Economics & Finance, Elsevier, vol. 60(C), pages 281-291.
    3. Henry Thompson & John Francis, 2009. "Tariff Elimination and the Wage Gap in an Industrial Specific Factors Model," Review of International Economics, Wiley Blackwell, vol. 17(3), pages 447-460, August.
    4. Henry Thompson, 2016. "Tourism Demand and Wages in a General Equilibrium Model of Production," Tourism Economics, , vol. 22(1), pages 81-91, February.
    5. Dasgupta, Indro & Osang, Thomas, 2002. "Globalization and relative wages: further evidence from U.S. manufacturing industries," International Review of Economics & Finance, Elsevier, vol. 11(1), pages 1-16, April.

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