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Cost of Protection where do we stand?


  • Arvind Panagariya

    (University of Maryland)


Economists measure the cost of protection in terms of static efficiency, growth rates and firm- or industry-level productivity effects. This survey is devoted exclusively to the literature on the static efficiency. A key preliminary point to note is that estimates in this literature are not derived econometrically from pre- and post- liberalization data. Instead, they are based on simulations of partial- or general-equilibrium models that are parameterized using estimates from the literature and calibrated around a pre-liberalization base year. This paper explores alternate measures of protection and thei welfare costs.

Suggested Citation

  • Arvind Panagariya, 2003. "Cost of Protection where do we stand?," International Trade 0308003, EconWPA.
  • Handle: RePEc:wpa:wuwpit:0308003
    Note: Type of Document - Tex/WordPerfect/Handwritten; prepared on IBM PC - PC-TEX/UNIX Sparc TeX; to print on HP/PostScript/Franciscan monk; pages: 345,395,4323247 ; figures: included/request from author/draw your own

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    References listed on IDEAS

    1. Joel Bergsman, 1974. "Commercial Policy, Allocative Efficiency, and "X-Efficiency"," The Quarterly Journal of Economics, Oxford University Press, vol. 88(3), pages 409-433.
    2. Bhagwati, Jagdish N, 1982. "Directly Unproductive, Profit-seeking (DUP) Activities," Journal of Political Economy, University of Chicago Press, vol. 90(5), pages 988-1002, October.
    3. Harris, Richard, 1984. "Applied General Equilibrium Analysis of Small Open Economies with Scale Economies and Imperfect Competition," American Economic Review, American Economic Association, vol. 74(5), pages 1016-1032, December.
    4. Romer, Paul, 1994. "New goods, old theory, and the welfare costs of trade restrictions," Journal of Development Economics, Elsevier, vol. 43(1), pages 5-38, February.
    5. Arvind Panagariya, 2003. "Alternative Approaches to Measuring the Cost of Protection," International Trade 0308002, EconWPA.
    6. Harry G. Johnson, 1960. "The Cost of Protection and the Scientific Tariff," Journal of Political Economy, University of Chicago Press, vol. 68, pages 327-327.
    7. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November.
    8. Douglas A. Irwin, 2001. "The Welfare Cost of Autarky: Evidence from the Jeffersonian Trade Embargo, 1807-1809," NBER Working Papers 8692, National Bureau of Economic Research, Inc.
    9. Krueger, Anne O, 1974. "The Political Economy of the Rent-Seeking Society," American Economic Review, American Economic Association, vol. 64(3), pages 291-303, June.
    10. Robert C. Feenstra, 1992. "How Costly Is Protectionism?," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 159-178, Summer.
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    Cited by:

    1. Arvind Panagariya, 2004. "India’s Trade Reform: Progress, Impact and Future Strategy:," International Trade 0403004, EconWPA.
    2. Idrisov, Georgy & Ponomareva, Ekaterina, 2016. "Analysis of the Efficiency of Natural Monopolies in Russia," Working Papers 2041, Russian Presidential Academy of National Economy and Public Administration.
    3. Georgy Idrisov, 2016. "Towards modern industrial policy for Russia," Research Paper Series, Gaidar Institute for Economic Policy, issue 169P, pages 157-157.
    4. Douglas A. Irwin, 2007. "Trade Restrictiveness and Deadweight Losses from U.S. Tariffs, 1859-1961," NBER Working Papers 13450, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • F2 - International Economics - - International Factor Movements and International Business


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