Explain the similarities between an import tariff and an import quota, and give examples?
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Abstract When Are A Tariff and A Quota Equivalent? This paper extends the work of Bhagwati and others on the ``nonequivalence'' of tariffs and quotas by taking the motive for protection into account. Specifically, the welfare cost associated with tariff or quota protection of a monopolized domestic industry is shown to depend on the objective underlying protection. Where the objective of protection is to raise domestic price, an import quota results in a lower welfare cost than a tariff which achieves the same objective. A quota may also provide a less costly means of fixing domestic monopoly profits at a predetermined level than a comparable tariff. /// Quand un droit de douane et un contingentement sont-ils équivalents? Cet article prolonge les travaux de Bhagwati et d'autres sur l'absence d'équivalence entre les droits et les contingentements, en tenant compte des raisons de la protection douanière. Même s'il n'y a pas d'équivalence « naturelle » entre les droits et les contingentements quand la production domestique est monopolisée, on peut redéfinir l'équivalence en terme de l'objectif particulier qui sous-tend la protection. L'étape suivante consiste à comparer les coûts en bien-être de la poursuite de cet objectif par différents moyens. Quand la protection a pour objectif d'augmenter le prix domestique, un contingentement à l'importation conduit à un coût en bien-être plus faible qu'un droit de douane qui permettrait d'atteindre le même résultat. Un contingentement représente probablement aussi un moyen moins coûteux de fixation des profits de monopoles domestiques à des niveaux prédéterminés, par comparison avec un droit comparable. Ces résultats présentent un intérêt certain dans la mesure où l'on suppose souvent que les contingentements sont particulièrement contre-indiqués quand la production domestiques est monopolisée. Par contraste, lorsque l'objectif visé est l'accroissement de la production domestique ou la réduction des importations, un droit permet d'atteindre les résultats visés à un coût en bien-être inférieur. Show Journal Information The Canadian Journal of Economics (CJE) is the journal of the Canadian Economics Association (CEA) and is published by Blackwell. The CJE has its roots in the journal Contributions to Canadian Economics, which began publication in the 1928 and was replaced in 1935 by the Canadian Journal of Economics and Political Science (CJEPS). In 1968, CJEPS divided into two parts: The Canadian Journal of Economics and the Canadian Journal of Political Science. The CJE and its forerunners have a long tradition as a leading general interest journal in economics and have published many classic papers in economics including, for example, Paul Samuelson's classic 1939 paper on the gains from trade and early work by Robert Mundell related to optimum currency areas. 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What is an example of an import quota?An import quota is a limit on the amount of imports that can be brought into a particular country. For example, the US may limit the number of Japanese car imports to 2 million per year. Quotas will reduce imports, and help domestic suppliers.
What is the difference between import quota and import tariff?The difference between quotas and tariffs
Their administration and effects, however, differ in specific ways. Quotas restrict the quantity of a good imported from another country. Tariffs are a charge levied on the value of goods imported from another country.
How is an import quota similar to and different than an equivalent tariff?Quotas focus on limiting the quantities (or, in some cases, cumulative value) of a particular good that a country imports or exports for a specific period, whereas tariffs impose specific fees on those goods.
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