This paper attempts to show another difference between tariffs and quotas in their economic effects. While a country's terms of trade could deteriorate after it imposes a tariff, a country's terms of trade will always improve after it imposes an import quota or an export quota. The offer curve approach is used in this study.
Get full access to this article
View all access options for this article.
References
1.
FalveyRodney, “A Note on the Distinction between Tariffs and Quotas,”Economica, August 1975, pp. 319–326.
2.
LernerA. P., “The symmetry between Import and Export Taxes,”Economica, August 1936, pp. 306–313; reprinted in Johnson, HarryG. and CavesRichard E., eds., Readings in International Economics (Richard D. Irwin, 1968), pp. 197–203.
3.
MeadeJames E., A Geometry of International Trade, (1952, George Allen and Unwin), Chapter 6.
4.
MetzlerLloyd A., “Tariffs, the Terms of Trade, and the Distribution of National Income,”Journal of Political Economy, February 1949, pp. 1–29.
