Effective Rates of Protection When Domestic and Foreign Goods Are Imperfect Substitutes: The Case of Thailand
Noting that standard calculations of effective rates of protection assume that domestic and foreign goods are perfectly substitutable, this paper relaxes that assumption. Using a fifty-four sector, general equilibrium model of Thailand, the authors compute effective rates of protection when the imported and domestically-produced good in each sector are assum ed to be imperfect substitutes and compare them with the effective rates of protection as derived using the standard approach. Their results show that the general-equilibrium calculation differs from the standard one not ju st in the ranking and magnitude of the effective rates of protection but sometimes even in the sign. Copyright 1992 by MIT Press.
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Volume (Year): 74 (1992)
Issue (Month): 4 (November)
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