Non-Tariff Barrier and Trade Liberalization
Simon Fraser University; CESifo (Center for Economic Studies and Ifo Institute)
Simon P. Anderson
University of Virginia - Department of Economics
CESifo Working Paper Series No. 254
This paper shows that governments have no incentive to introduce non-tariff barriers when they are free to set tariffs but they do when tariffs are determined cooperatively. We then show three results. First, with trade liberalization, there is a progression from using tariffs only to quotas, and to antidumping constraints (when quotas are jointly eliminated). Second, there is a narrowing of the range of industries in which each instrument is used. Third, the degree of tariff liberalization and of replacement of tariffs by NTBs depend on industry characteristics. These results are roughly in line with the empirical evidence.
Number of Pages in PDF File: 36
JEL Classification: F12, F13, L13
Date posted: April 5, 2001
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