国际经济学(双语)-第4章.ppt

Tariffs and Nontariff BarriersInternational EconomicsChapter 4Chapter 4 Tariffs and Nontariff Barriersn4.1 Theories for Trade Protectionn4.2 Tariffsn4.3 Nontariff Trade Barriers4.1 Theories for Trade Protectionn Infant Industry Argument uThis argument contends that for free trade to be meaningful,trading countries should temporarily shield their newly developing industries from foreign competition.4.1 Theories for Trade ProtectionuSome truths in the infant industry argument:lOnce a protective tariff is imposed,it is very difficult to remove,even after industrial maturity has been achieved.lIt is very difficult to determine which industries will be capable of realizing comparative advantage potential and thus merit protection.l The argument generally is not valid for mature,industrialized countries.lThere may be other ways of insulating a developing industry from cutthroat competition.Rather than adopt a protective tariff,the government could grant a subsidy to the industry.4.1 Theories for Trade ProtectionnTerms of Trade ArgumentuIn some cases,the terms of trade benefits of a tariff outweigh its costs,so there is a terms-of-trade argument for a tariff.uThe terms of trade argument against free trade,then,is intellectually impeccable but of doubtful usefulness.uIn practice,it is emphasized more by economists as a theoretical proposition than it is used by governments as a justification for trade policy.4.1 Theories for Trade ProtectionnDomestic Market Failure Argument uTheory of the second best lWhen economists apply the theory of the second best to trade policy,they argue that imperfections in the internal functioning of an economy may justify interfering in its external economic relations.lThis argument accepts that international trade is not the source of the problem but suggests nonetheless that trade policy can provide at least a partial solution.4.1 Theories for Trade ProtectionnStrategic Trade Policyu Because of the small number of firms,the assumption of perfect competition does not apply.There are only a few firms in effective competition in some industries.uThis argument locates the market failure that justifies government intervention in the lack of perfect competition.uIt is possible in principle for a government to alter the rules of the game to shift these excess returns from foreign to domestic firms.Chapter 4 Tariffs and Nontariff Barriersn4.1 Theories for Trade Protectionn4.2 Tariffsn4.3 Nontariff Trade Barriers4.2 TariffsnA tariff is simply a tax(duty)levied on a product when it crosses national boundaries.uImport tariff v.s.Export tariff uProtective tariff v.s.Revenue tariff nTypes of Tariffs uSpecific Tariff uAd Valorem Tariff uCompound Tariff 4.2 TariffsnEffective Rate of Protection(ERP)uthe percentage change in the value added in an industry because of the imposition of a tariff structure by the country rather than the existence of free trade.4.2 TariffsuCalculation of ERP(Way I):4.2 TariffsuCalculation of ERP(Way II):4.2 Tariffsu Three general rules about the relationship between nominal rates and effective rates of protection:lIf the nominal tariff rate on the final good is higher than the weighted average nominal tariff rate on the inputs,then the ERP will be higher than the nominal rate on the final goods;lIf the nominal tariff rate on the final good is lower than the weighted average nominal tariff rate on the inputs,then the ERP will be lower than the nominal rate on the final goods;lIf the nominal tariff rate on the final good is equal to the weighted average nominal tariff rate on the inputs,then the ERP will be equal to the nominal rate on the final goods.4.2 TariffsuTwo consequences of the effective rate calculation:lThe degree of effective protection increases as the value added by domestic producers declines.In the formula,the higher the value of aij is,the greater the effective protection rate for any given nominal tariff rate on the final product will be.lA tariff on imports used in the production process reduces the level of effective protection.In the formula,as ti rises,the numerator of the formula decreases and hence ERP decreases.4.2 TariffsuConclusionlwhen material inputs or intermediate products enter a country at a very low duty while the final imported commodity is protected by a high duty,the result tends to be a high protection rate for the domestic producers.The nominal tariff rate on finished goods thus understates the effective rate of protection.lBut should a tariff be imposed on imported inputs that exceeds that on the finished good,the nominal tariff rate on the finished product would tend to overstate its protective effect.4.2 TariffsuTariff Escalation lThe tariff structures have generally been characterized by rising rates that give greater protection to intermediate and finished products than to primary commodities.p The tariff structures of the industrialized countries may indeed discourage the growth of processing,thus hampering diversification into higher value-added exports for the less developed countries,worsening the potential competitive position of the less-developed countries in the manufacturing and processing sectors.4.2 TariffsnTariff Welfare Effects uConsumer SurpluslConsumer surplus refers to the difference between the amount that buyers would be willing and able to pay for a good and the actual amount they do pay.uProducer SurpluslProducer surplus is the revenue producers receive over and above the minimum amount required to induce them to supply the good.4.2 Tariffs4.2 TariffsuTrade Welfare Effect of Tariff in a Partial Equilibrium Setting lThe Small-Nation Case 4.2 TariffspThe redistributive effect(Area a)lthe transfer of consumer surplus,in monetary terms,to the domestic producers of the import-competing product.pThe protective effect(Area b)lthe loss to the domestic economy resulting from wasted resources used to produce additional cloth at increasing unit costs.pThe domestic revenue effect(Area c)lthe tariff proceeds paid by country As consumers to its government.pThe consumption effect(Area d)larises from the decrease in consumption resulting from the tariffs artificially increasing the price.pThe deadweight loss (Areas b+d)lrepresents a real cost to a community,not a transfer to other sectors of the economy.4.2 TariffsuLevying an import tariff,therefore,reduces a small countrys welfare.Welfare Cost of a Tariff Imposed by a Small Nation ItemWelfare Change(Area)Change in consumer surplusabcdChange in producer surplusaChange in government revenuecNet welfare changebd4.2 TariffslThe Large-Nation Case lThe equilibrium world price is defined as the price at which the quantity that consumers in Country A want to import is equal to the quantity that producers in Country B want to export.In the diagram,this price is denoted by PFT.International Free-Trade Equilibrium 4.2 TariffslThe size of the tariff equals the difference between the price consumers in country A pay for the product(PT)and the price producers in country B receive(P).That is,the per unit tariff of t equals PT P.4.2 TariffspThe redistributive effect(Area a)lthe transfer of consumer surplus,in monetary terms,to the domestic producers of the import-competing product.pThe protective effect(Area b)lthe loss to the domestic economy resulting from wasted resources used to produce additional cloth at increasing unit costs.pThe domestic revenue effect(Area c)lthe tariff proceeds paid by country As consumers to its government.pThe consumption effect(Area d)larises from the decrease in consumption resulting from the tariffs artificially increasing the price.pThe terms of trade effect(Area e)lthe amount of the tariff revenue paid by foreigners because the world price of their exports has fallen.4.2 TariffslThe change in welfare in country A brought about by the imposition of a tariff equals e(b+d).This amount could be positive or negative,depending on the relative sizes of the two terms.lOptimal tariff:the tariff would be set to a level that maximizes the area e(b+d).4.2 TariffsuTrade Welfare Effect of Tariff in a General Equilibrium Setting lThe Small-Nation Case 4.2 TariffspThe reduction in welfare comes from two effects:The economy no longer produces at a point that maximizes the value of income at world prices.The budget constraint that passes through B1 lies inside the constraint passing through B0.Consumers do not choose the welfare-maximizing point on the budget constraint;they do not move up to an indifference curve that is tangent to the economys actual budget constraint.4.2 TariffslThe Large-Nation Case With the imposition of a tariff,Country Is offer curve OCI shifts inward to OCI.4.2 TariffsThe Impact of a TariffThe equilibrium quantity of exports falls from OB1 to OB2,and the quantity of imports falls from OA1 to OA2.Country Is terms of trade improve from TOT1 to TOT2.Chapter 4 Tariffs and Nontariff Barriersn4.1 Theories for Trade Protectionn4.2 Tariffsn4.3 Nontariff Trade Barriers4.3 Nontariff Trade BarriersnAn Introduction to Nontariff Trade Barriersu Import Quota lAn import quota is a physical restriction on the quantity of goods that may be imported during a specific period;the quota generally limits imports to a level below which imports would occur under free-trade conditions.lA common practice to administer an import quota is for the government to require an import license.Each license specifies the volume of imports allowed,and the total volume allowed should not exceed the quota.lImport quotas on manufactured goods have been outlawed by the World Trade Organization.4.3 Nontariff Trade BarriersuTariff-Rate Quota:A Two-Tier Tariff l a tariff-rate quota displays both tariff-like and quota-like characteristics.This device allows a specified number of goods to be imported at one tariff rate(the within-quota tariff rate),whereas any imports above this level face a higher tariff rate(the over-quota tariff rate).la tariff rate quota is a two-tier tariff.4.3 Nontariff Trade Barriersu Orderly Marketing Agreements l An orderly marketing agreement(OMA)is a market-sharing pact negotiated by trading partners.lIts main purpose is to moderate the intensity of international competition,allowing less efficient domestic producers to participate in markets that would otherwise have been lost to foreign producers who sell a superior product at a lower price.lA typical OMA consists of voluntary quotas applied to exports.These controls are known as voluntary export restraints(VERs);they are sometimes supplemented by backup import controls to ensure that the restraints are effective.4.3 Nontariff Trade Barriersu Domestic Content Requirements l To limit the practice of outsourcing,organized labor has lobbied for the use of domestic content requirements.lThe effect of content requirements is to pressure both domestic and foreign firms who sell products in the home country to use domestic inputs(workers)in the production of those products.lManufacturers generally lobby against domestic content requirements,because they prevent manufacturers from obtaining inputs at the lowest cost,thus contributing to higher product prices and loss of competitiveness.4.3 Nontariff Trade BarriersuSubsidies l National governments sometimes grant subsidies to their producers to help improve their trade position.lGovernmental subsidies assume a variety of forms,including outright cash disbursements,tax concessions,insurance arrangements,and loans at below-market interest rates.l Two types of subsidies:a domestic subsidy which is sometimes granted to producers of import-competing goods;an export subsidy which goes to producers of the goods that are to be sold overseas.4.3 Nontariff Trade BarriersuDumpingl Dumping is recognized as a form of international price discrimination.lIt occurs when foreign buyers are charged lower prices than domestic buyers for an identical product,after allowing for transportation costs and tariff duties.Selling in foreign markets at a price below the cost of production is also considered dumping.lCommercial dumping is generally viewed as sporadic,predatory,or persistent in nature.Each type is practiced under different circumstances.4.3 Nontariff Trade BarriersnThe effects of an Import Quota In the absence of trade,equilibrium would occur at Point E with the domestic price of cloth equaling P.The free-trade equilibrium is located at Point F,the domestic price of cloth would fall to the world price PW.The imposition of the quota changes the amount of cloth supplied to the importing country,a new equilibrium is reached at G.4.3 Nontariff Trade BarriersuThe country loses Areas b+c+d under a quota.lThe redistributive effect(Area a)lThe protective effect(Area b)lThe domestic revenue effect(Area c)pArea c accrues to the foreign producers and makes them more profitable.lThe consumption effect(Area d)lThe deadweight loss (Areas b+d)4.3 Nontariff Trade BarrierslTwo methods available for a government or community to capture Area c from foreign producers under a quota.The domestic government could auction quotas to importers in a free market.The limited quota supply would go to those importers most in need of the product who would pay the higher price.Convert the quota into an equivalent tariff.4.3 Nontariff Trade BarriersnQuota and equivalent tariffu The losses for consumers and community are much larger in the case of a quota than in the case of a tariff when demand increases.4.3 Nontariff Trade BarriersnThe Effects of an Export Subsidy Consumers lose Area a+b in the form of higher taxes.Producers gain Area a in profits.The cost to the community is Area b,that is the production deadweight cost of the subsidy.Subsidies are superior to protection in another way:they are more visible.