On Functionally Distributed Quotas

12 Pages Posted: 22 Oct 2007

See all articles by John Gilbert

John Gilbert

Utah State University - College of Business - Department of Economics

Abstract

We consider "functionally distributed" quotas, where trade is restricted to a function of another economic activity, paying special attention to the ratio constraint and its relation to "proportionally distributed" quotas. We propose a simple principle defining the optimal policy under a functionally defined restriction, extend the analysis of ratio import/production constraints to general equilibrium, introduce export constraints, and constraints defined in proportion to factor use. We develop the general-equilibrium geometry of functional trade constraints and the concomitant optimal policies, deriving a "quota locus" that depicts the consumption possibilities under various regimes.

Suggested Citation

Gilbert, John, On Functionally Distributed Quotas. Review of International Economics, Vol. 15, No. 5, pp. 977-988, November 2007. Available at SSRN: https://ssrn.com/abstract=1023244 or http://dx.doi.org/10.1111/j.1467-9396.2007.00666.x

John Gilbert (Contact Author)

Utah State University - College of Business - Department of Economics ( email )

3530 Old Main Hill
Logan, UT 84322-3530
United States
435-797-2314 (Phone)
435-797-2701 (Fax)

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