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1、Chapter 9 Nontariff Trade Barriers and New Protectionism,9.1 Introduction There are many other types of trade barriers, such as import quotas, voluntary export restraints, and antidumping actions. Section 9.2 examines the effect of an import quota and compares them to those of an import tariff. Sect
2、ion 9.3 deals with other nontariff trade barriers and includes a discussion of voluntary export restraints and other regulations, as well as trade barriers resulting from international cartels, dumping, and export subsidies.,9.2 Import Quotas A quota is the most important nontariff trade barrier. It
3、 is a direct quantitative restrictions on the amount of a commodity allowed to be imported or exported. 9.2 A Effects of an Import Quota The given import quota is 30X,20,30,10,0,Px ($),2,3,1,5,4,40,50,60,B,A,E,N,H,70,80,J,M,C,G,Sx,Dx,R,G,2.5,25,55,65,Dx,J,H,K,9.2 B Comparison of an Import Quota to a
4、n Import Tariff With a given import quota, an increase in demand will result in a higher domestic price and greater domestic production than with an equivalent import tariff. A given import tariff, an increase in demand will leave the domestic price and domestic production unchanged but will result
5、in higher consumption. The quota involves the distribution of imports licenses. An import quota limits imports to the specified level with certainty while the trade effect of an import tariff may be uncertain.,9.3 Other Nontariff Barriers and New Protectionism 9.3 A Voluntary Export Restraints These
6、 refer to the case where an importing country induces another nation to reduce its export of commodity “ voluntarily”, under the threat of higher all-round trade restrictions, when these exports threaten an entire domestic industry. “Orderly marketing arrangements” Purpose to make use of VERs. Econo
7、mic effects of VERs. VERs were less effective in limiting imports than import quotas.,9.3 B Technical Administrative, and other Regulations Safety regulations for automobile and electrical equipment. Health regulations for the hygienic production and packaging of imported food products. Labeling req
8、uirements showing origin and contents. Government procurement policy (政府采购政策) Border taxes,9.3 C International Cartels An international cartel is an organization of suppliers of a commodity located in different nations( or a group of governments) that agrees to restrict output and exports of the com
9、modity with the aim of maximizing or increasing the total profit of the organization. OPEC International Air Transport Association An international cartel is more likely to be successful if there are only a few international suppliers of an essential commodity for which there are no close substitute
10、s.,9.3 D Dumping Dumping is the export of a commodity at below cost or at least the sale of a commodity at lower price abroad than domestically. Persistent dumping (international price discrimination), is the continuous tendency of a domestic monopolist to maximize total profits by selling the commo
11、dity at higher price in the domestic market than internationally. Predatory dumping is the temporary sale of a commodity at below cost or at a lower price abroad in order to drive foreign producers out business, after which prices are raised to take advantage of the newly acquired monopoly power abr
12、oad.,Sporadic dumping is the occasional sale of a commodity at below cost or at a lower price abroad than domestically in order to unload an unforeseen and temporary surplus of the commodity without having to reduce domestic prices. Trigger-price mechanism （触发价格机制） 9.3 E Export Subsidies Export subs
13、idies are direct payment or granting of tax relief and subsidized loans to the nations exporters or potential exporters and or low-interest loans to foreign buyers so as to stimulate the nations exports.,Export-import bank Foreign Sales Corporation provisions of the U.S. tax code. Particularly troub
14、lesome are the very high support prices provided by the European Union to maintain its farmers income under its common agriculture policy. (CAP) Countervailing duties (反补贴税）,20,30,10,0,Px ($),2,3,1,5,4,40,50,60,B,A,E,N,H,70,80,b,M,C,a,Sx,Dx,R,G,3.5,35,J,c,d,Reading Task: case study 9-2, 9-3, 9-4 and
15、 9-5. Homework: Page 310 Questions for review: What is an import quota? What is meant by voluntary export restraints? What are international cartels? What is meant by dumping? What are the different types of dumping? Why do nations subsidize exports?,9.4 The Political Economy of Protection,Fallaciou
16、s and Questionable Arguments for Protection; The Infant-Industry and Other Qualified Arguments for Protection; Who Gets Protected?,Fallacious and Questionable Arguments for Protection,Trade protections are needed to protect domestic labor against cheap foreign labor (fallacious); The scientific tariff would make the price of imports equal to domestic prices and allow domestic producers to meet foreign competit
