Whether to Choose Tariffs or Subsidies to Protect a Domestic Industry

• 영문명: Whether to Choose Tariffs or Subsidies to Protect a Domestic Industry
• 발행기관: 세종대학교 경제통합연구소
• 저자명: Dominik Egli Frank Westermann
• 간행물 정보: 『Journal of Economic Integration』제18권 제1호, 150~163쪽, 전체 14쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2003.03.31

영문 초록

The use of tariffs in the absence of subsidies in small countries is an empirical observation which stands in sharp contrast to the theoretical literature of trade policy. We analyze the welfare effects of tariffs and subsidies in a homogeneous good duopoly game with cost asymmetries between the two firms, allowing for distortionary taxation. We find that for reasonable values of the distortion parameter or for a large cost disadvantage of the home firm, a tariff is the optimal policy tool.

목차

Ⅰ. Introduction

Ⅱ. The Model

Ⅲ. Import Tariff

Ⅳ. Home Firm Subsidy

Ⅴ. Comparison of Trade Policy Instruments

Ⅵ. Concluding Remarks

키워드

Strategic trade Economies in transition Cost asymmetries Distortionary taxation