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Tariffs and income : a time series analysis for 24 countries

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  • Sharp, Paul
  • Lampe, Markus

Abstract

We argue for a new approach to examining the relationship between tariffs and growth. We demonstrate that more can be learned from time series analyses of the experience of individual countries rather than the usual panel data approach, which imposes a causal relation and presents an average coefficient for all countries. Tentative initial results using simple two variable cointegrated VAR models suggest considerable heterogeneity in the experiences of the countries we look at. For most, however, there was a negative relationship between tariffs and levels of income for both the preand post-Second World War periods. However, in the second half of the twentieth century, the causality ran from income to tariffs: i.e. countries simply liberalized as they got richer. Policy decisions based on the usual panel approach might thus be very inappropriate for individual countries

Suggested Citation

  • Sharp, Paul & Lampe, Markus, 2012. "Tariffs and income : a time series analysis for 24 countries," IFCS - Working Papers in Economic History.WH wp12-08, Universidad Carlos III de Madrid. Instituto Figuerola.
  • Handle: RePEc:cte:whrepe:wp12-08
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    References listed on IDEAS

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    1. Tena Junguito, Antonio, 2007. "New series of the Spanish foreign sector, 1850-2000," IFCS - Working Papers in Economic History.WH wp07-14, Universidad Carlos III de Madrid. Instituto Figuerola.
    2. Peter Llyod, 2007. "100 Years of Tariff Protection in Australia," Department of Economics - Working Papers Series 1023, The University of Melbourne.
    3. José Jofre & Rolf Lüders & Gert Wagner, "undated". "Economía Chilena 1810-1995. Cuentas Fiscales," Documentos de Trabajo 188, Instituto de Economia. Pontificia Universidad Católica de Chile..
    4. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 28241, December.
    5. World Bank, 2008. "World Development Indicators 2008," World Bank Publications - Books, The World Bank Group, number 11855, December.
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    Cited by:

    1. Mitchener, Kris James & Wandschneider, Kirsten, 2015. "Capital controls and recovery from the financial crisis of the 1930s," Journal of International Economics, Elsevier, vol. 95(2), pages 188-201.
    2. Luis Cárdenas del Rey, 2019. "Salarios y crecimiento económico durante el desarrollismo franquista," Documentos de Trabajo (DT-AEHE) 1906, Asociación Española de Historia Económica.
    3. Julia Cage & Lucie Gadenne, 2018. "Tax Revenues and the Fiscal Cost of Trade Liberalization, 1792-2006," Post-Print hal-03391923, HAL.
    4. Julia Cage & Lucie Gadenne, 2014. "Tax Revenues, Development, and the Fiscal Cost of Trade Liberalization, 1792-2006," Sciences Po publications info:hdl:2441/4icc4hr7684, Sciences Po.
    5. Vincent Bignon & Cecilia Garcia-Peñalosa, 2018. "The Toll of Tariffs: Protectionism, Education and Fertility in Late 19th Century France," Working papers 690, Banque de France.
    6. Nina Boberg-Fazlic & Markus Lampe & Maja Uhre Pedersen & Paul Sharp, 2021. "Pandemics and protectionism: evidence from the “Spanish” flu," Palgrave Communications, Palgrave Macmillan, vol. 8(1), pages 1-9, December.
    7. Vincent Bignon & Cecilia Garcia-Peñalosa, 2016. "Protectionism and the Education-Fertility Trade-off in Late 19th Century France," AMSE Working Papers 1604, Aix-Marseille School of Economics, France, revised Jan 2016.
    8. Giovanni Federico & Paul Sharp & Antonio Tena-Junguito, 2017. "Openness and growth in a historical perspective: a VECM approach," Working Papers 0118, European Historical Economics Society (EHES).
    9. Nikolaus Wolf, 2021. "Deutschland in der ersten Globalisierung," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 101(4), pages 254-258, April.
    10. Toke Aidt & Peter Jensen, 2013. "Democratization and the size of government: evidence from the long 19th century," Public Choice, Springer, vol. 157(3), pages 511-542, December.
    11. Léo CHARLES, 2017. "A new empirical test of the infant-industry argument : the case of Switzerland protectionism during the 19th century," Cahiers du GREThA (2007-2019) 2017-11, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    12. Patrick Alexander & Ian Keay, 2018. "Responding to the First Era of Globalization: Canadian Trade Policy, 1870–1913," Staff Working Papers 18-42, Bank of Canada.
    13. Peter H. Bent, 2018. "Recovery from Financial Crises in Peripheral Economies, 1870-1913," CEH Discussion Papers 07, Centre for Economic History, Research School of Economics, Australian National University.
    14. Bent, Peter H., 2020. "Recovery from financial crises in peripheral economies, 1870–1913," Explorations in Economic History, Elsevier, vol. 78(C).
    15. Toshiki Kawashima, 2018. "A European Political-Economic Space That Embraced Japan: The International Context of the Conventional Tariff Network, CA. 1892-1914," CEH Discussion Papers 08, Centre for Economic History, Research School of Economics, Australian National University.
    16. Cagé, Julia & Gadenne, Lucie, 2018. "Tax revenues and the fiscal cost of trade liberalization, 1792–2006," Explorations in Economic History, Elsevier, vol. 70(C), pages 1-24.
    17. Samuel Standaert & Stijn Ronsse & Benjamin Vandermarliere, 2016. "Historical trade integration: globalization and the distance puzzle in the long twentieth century," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 10(2), pages 225-250, May.
    18. Bajo-Rubio, Oscar, 2020. "Exports and long-run growth: The case of Spain, 1850-2017," GLO Discussion Paper Series 461, Global Labor Organization (GLO).

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    More about this item

    Keywords

    Tariff/growth relationship;

    JEL classification:

    • F1 - International Economics - - Trade
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • N7 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

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