Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
By Robert J. Carbaugh
9th Edition
Chapter 5:
Tariffs
Tariffs
Carbaugh, Chap. 5
Tariffs
Defining tariffs
A tariff is a tax (duty) levied on products as
they move between nations
Import tariff - levied on imports
Export tariff - levied on exported goods as they
leave the country
Protective tariff - designed to insulate domestic
producers from competition
Revenue tariff - intended to raise funds for the
government budget (no longer important in
industrial countries)
Carbaugh, Chap. 5
Tariffs
Types of tariff
Specific tariff ( )
Fixed monetary fee per unit of the
product
Example: A specific tariff of $10 on
each imported bicycle with an
international price of $100 means
that customs officials collect the
fixed sum of $10.
Carbaugh, Chap. 5
Ad valorem tariff ( )
Levied as a percentage of the value of the
product
Example: A 20% ad valorem tariff on bicycles
generates a $20 payment on each $100
imported bicycle.
Compound tariff ( )
A combination of the above, often levied on
finished goods whose components are also
subject to tariff if imported separately
Carbaugh, Chap. 5
Tariffs
Carbaugh, Chap. 5
Tariffs
Tariffs
Carbaugh, Chap. 5
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Tariffs
Producer surplus
The revenue producers receive above the
minimum amount required to induce them to
produce a good
Carbaugh, Chap. 5
11
Tariffs
Carbaugh, Chap. 5
12
13
Carbaugh, Chap. 5
14
Carbaugh, Chap. 5
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Tariff effects
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Politics of protectionism
Supply of protectionism (trade policy)
depends on:
the cost to society of restricting trade
the political importance of the importcompeting industries
Magnitude of the adjustment costs from free
trade
Public sympathy for those sectors hurt by free
trade
Carbaugh, Chap. 5
18
Politics of protectionism
Demand for protectionism depends on:
The amount of the import-competing industrys
comparative disadvantage
The level of import penetration
The level of concentration in the affected sector
The degree of export dependence in the sector
Carbaugh, Chap. 5
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