Optimum Tariffs and Retaliation*
DURING recent years the proposition first advanced by Mill and formalized by Bickerdike, that a country can improve its welfare as compared with the free trade position by imposing a tariff on imports, has achieved general recognition in the literature of international trade theory. There is still, however, some confusion over what happens if other countries retaliate by imposing tariffs in their turn. Although Kaldor,1 in his classic revival of the proposition, referred explicitly to the possibility that a country might gain by imposing a tariff even if other countries retaliated—a possibility which is also indicated by considerations of general monopoly theory—the possibility is often overlooked: ...
Get International Trade and Economic Growth (Collected Works of Harry Johnson) now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
