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We consider three political-economy arguments in favor of a uniform tariff rule (UTR). First, if tariffs are determined by lobbying, adoption of a UTR creates a free-rider problem. A tariff resulting from lobbying by one sector becomes available to all other sectors. This reduces incentive for...
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Two small countries facing a constant probability of war with each other import arms for consumption goods from the rest of the world. The defense good, produced by combining arms and army, is a public good. The reaction curve depicting the optimal supply of the defense good turns out to be...
Persistent link: https://www.econbiz.de/10005401089