The qualitative restrictions implied by the first-order conditions of the optimal tax problem are generally so weak that little can be said as to what constitutes an optimal set of taxes. It is therefore desirable that one have available a technique for computing optimal taxes in a full general...

The paper examines the consequences of a 50 percent cut of tariff and non-tariff barriers within an applied general equilibrium model of the Canadian economy. The large welfare gains are explained in terms of scale economics and the procompetitive effects of import competition. Sensitivity...