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Revenue argument for a tariff |
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Revenue argument for a tariffThe use of a tariff to raise revenue for the government. Many other kinds of tax cause smaller distortions and are therefore preferable to tariffs for this purpose. However, a tariff is one of the easier taxes to collect, and it is therefore common in the early stages of a country's development.Similar MatchesTerms of trade argumentTerms of trade argumentSame as the optimal tariff argument, which works by restricting the quantity of trade in order to improve the terms of trade. Optimal tariff argumentOptimal tariff argumentAn argument in favor of levying a tariff in order to improve the terms of trade. The argument is valid only in a large country, and then only if other countries do not retaliate by raising tariffs themselves. Even then, this is a beggar thy neighbor policy, since it lowers welfare abroad. See Johnson (1954). Infant industry argumentInfant industry argumentThe theoretical rationale for infant industry protection. Second-best argument for protectionSecond-best argument for protection1. Any argument for protection that can be countered by pointing to a different and less distortionary policy that would achieve the same desired result at lower economic cost. 2. An argument for protection to partially correct an existing distortion in the economy when the first-best policy for that purpose is not available. For example, if domestic production generates a positive externality and a production subsidy to internalize it is not available, then a tariff may be second-best optimal. Cultural argument for protectionCultural argument for protectionThe view that imports undermine a country's culture and identity -- for example by changing consumption patterns to ones more similar to those abroad, or by reducing demands for domestically produced art and music -- and therefore that imports should be restricted. Further SuggestionsNoneconomic objectives argument for protectionStrategic trade policy argument for a tariff Labor standards argument for protection Income redistribution argument for a tariff Labor standards argument for protection National defense argument for protection Self-sufficiency argument for protection Patriotism argument for protection Externalities argument for protection Domestic distortions argument for protection Fairness argument for protection Employment argument for protection Balance of payments argument for protection Environmental protection argument for a trade intervention Sunset industry argument Pauper labor argument Monopoly argument Infant industry argument Foreign investment argument for protection |
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