The geometry of protectionism in the imperfect substitutes model: a reminder.
The technique used by the U.S. Federal and International Trade Commissions (ITC) to estimate the cost of restricting imports of a good that substitutes imperfectly for domestic goods is valid, provided the relevant supply and demand functions are linear in prices and the relevant goods display zero...
| Publicado en: | Southern Economic Journal Vol. 60; pp. 235 - 239 |
|---|---|
| Autor principal: | |
| Formato: | Artículo |
| Publicado: |
Southern Economic Association
July 1993
|
| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| Sumario: | The technique used by the U.S. Federal and International Trade Commissions (ITC) to estimate the cost of restricting imports of a good that substitutes imperfectly for domestic goods is valid, provided the relevant supply and demand functions are linear in prices and the relevant goods display zero income elasticities of demand. In the base case of a small country, the ITC geometry is convenient in that it depicts the deadweight loss solely with prices and quantities in the market that is taxed directly. The extension of this approach to the case of a large country is straightforward; an example involving the estimate of the U.S. loss from the VER on Japanese cars is provided. |
|---|