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Domestic distortions and international trade

Anderson, J. and Neary, J. P. (1993) Domestic distortions and international trade. CEPDP, 179. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

In this paper, we investigate techniques for measuring the trade policy equivalent of domestic distortions, using a distance function approach. Our measure, the Trade Restrictiveness Index, is shown to equal the uniform tariff which is welfare-equivalent to a given pattern of domestic taxes and subsidies. We extend the Index to incorporate taxes in markets for non-traded goods and factors of production and illustrates its operationality with an application to liberalisation in Mexican agriculture. We conclude that our Index has considerable potential in empirical work and as an aid to trade negotiations.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk
Additional Information: © 1993 the authors
Library of Congress subject classification: H Social Sciences > HF Commerce
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 179
Date Deposited: 19 Aug 2008 08:46
URL: http://eprints.lse.ac.uk/20926/

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