Arbeitspapier

Costly revenue-raising and the case for favoring import-competing industries

A standard finding in the political economy of trade policy literature is that we should expect export-oriented industries to attract more assistance than import-competing industries. In reality, however, trade policy is heavily biased toward supporting import industries. This paper shows within a standard protection for sale framework, how the costliness of raising revenue via taxation may make export subsidies less desirable and import tariffs more desirable. The model is then estimated and its predictions are tested using U.S. tariff data. An empirical estimate of the costliness of revenue-raising is also obtained.

Language
Englisch

Bibliographic citation
Series: CESifo Working Paper ; No. 1502

Classification
Wirtschaft
Trade and Labor Market Interactions
Trade Policy; International Trade Organizations
Subject
protection for sale
tariffs
trade protection
Außenhandelspolitik
Außenhandelsbeschränkung
Steuererhebung
Schätzung
USA
protection for sale

Event
Geistige Schöpfung
(who)
Matschke, Xenia
Event
Veröffentlichung
(who)
Center for Economic Studies and ifo Institute (CESifo)
(where)
Munich
(when)
2005

Handle
Last update
10.03.2025, 11:44 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Matschke, Xenia
  • Center for Economic Studies and ifo Institute (CESifo)

Time of origin

  • 2005

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