Tariff Reductions, Entry, and Welfare: Theory and Evidence for the Last Two Decades /
We show in a multi-sector, heterogeneous-firm trade model that the effect of tariffs on entry, especially in the presence of production linkages, can reverse the traditional positive optimal tariff argument. We then use a new tariff dataset, and apply it to a 189-country, 15-sector version of our mo...
Gespeichert in:
- Weitere Titel:
- Tariff Reductions, Entry, and Welfare
- 1. Verfasser:
- Körperschaft:
- Weitere Verfasser:
- , ,
- Format:
- Elektronisch E-Book
- Sprache:
- Englisch
- Veröffentlicht:
-
Cambridge, Mass.
National Bureau of Economic Research
2015.
- Zusammenfassung:
-
We show in a multi-sector, heterogeneous-firm trade model that the effect of tariffs on entry, especially in the presence of production linkages, can reverse the traditional positive optimal tariff argument. We then use a new tariff dataset, and apply it to a 189-country, 15-sector version of our model, to quantify the trade, entry, and welfare effects of trade liberalization over the period 1990-2010. We find that the impact on firm entry was larger in Advanced relative to Emerging and Developing countries; that slightly more than three-quarters of the total gains from trade are a consequence of the reductions in MFN tariffs (the Uruguay Round), with two-thirds of the remainder due to preferential trade agreements and one third due to the hypothetical movement to free trade; and that free trade would bring gains for some Emerging and Developing countries, in particular. Ten economies in our sample - including China, Hong Kong, India, Israel, Vietnam, and five more remote countries - would have benefited from going beyond free trade to subsidizing their imports in 1990, since their optimal tariffs are negative.
- Umfang:
- 1 online resource: illustrations (black and white);
- Anmerkungen:
- December 2015.
- Schlagworte: