The Optimal Degree of Reciprocity in Tariff Reduction
This article clari.es the roles played by trade policy, in contrast with iceberg transport cost, in the popular setting of Melitz (2003), and characterizes the optimal reciprocal trade policy in such a setting. I show that import tariffs and iceberg transport cost are not equivalent in the strength...
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Institutional Knowledge at Singapore Management University
2010
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sg-smu-ink.soe_research-21612010-12-20T01:44:09Z The Optimal Degree of Reciprocity in Tariff Reduction CHANG, Pao Li This article clari.es the roles played by trade policy, in contrast with iceberg transport cost, in the popular setting of Melitz (2003), and characterizes the optimal reciprocal trade policy in such a setting. I show that import tariffs and iceberg transport cost are not equivalent in the strength of their trade-restricting e¤ects and their welfare implications. With all the con.icting effectsof import tari¤s on welfare considered, the optimal degree of reciprocity in multilateral tari¤ reduction turns out to be free trade. 2010-02-01T08:00:00Z text application/pdf https://ink.library.smu.edu.sg/soe_research/1162 https://ink.library.smu.edu.sg/context/soe_research/article/2161/viewcontent/hetero_iit_policy.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection School Of Economics eng Institutional Knowledge at Singapore Management University Firm Heterogeneity Reciprocal Trade Policy. Economic Policy Finance International Business |
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SMU Libraries |
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Asia |
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Singapore Singapore |
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English |
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Firm Heterogeneity Reciprocal Trade Policy. Economic Policy Finance International Business |
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Firm Heterogeneity Reciprocal Trade Policy. Economic Policy Finance International Business CHANG, Pao Li The Optimal Degree of Reciprocity in Tariff Reduction |
| description |
This article clari.es the roles played by trade policy, in contrast with iceberg transport cost, in the popular setting of Melitz (2003), and characterizes the optimal reciprocal trade policy in such a setting. I show that import tariffs and iceberg transport cost are not equivalent in the strength of their trade-restricting e¤ects and their welfare implications. With all the con.icting effectsof import tari¤s on welfare considered, the optimal degree of reciprocity in multilateral tari¤ reduction turns out to be free trade. |
| format |
text |
| author |
CHANG, Pao Li |
| author_facet |
CHANG, Pao Li |
| author_sort |
CHANG, Pao Li |
| title |
The Optimal Degree of Reciprocity in Tariff Reduction |
| title_short |
The Optimal Degree of Reciprocity in Tariff Reduction |
| title_full |
The Optimal Degree of Reciprocity in Tariff Reduction |
| title_fullStr |
The Optimal Degree of Reciprocity in Tariff Reduction |
| title_full_unstemmed |
The Optimal Degree of Reciprocity in Tariff Reduction |
| title_sort |
optimal degree of reciprocity in tariff reduction |
| publisher |
Institutional Knowledge at Singapore Management University |
| publishDate |
2010 |
| url |
https://ink.library.smu.edu.sg/soe_research/1162 https://ink.library.smu.edu.sg/context/soe_research/article/2161/viewcontent/hetero_iit_policy.pdf |
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