Rent Seeking with Politically Contestable Rights to Tariff-rate Import Quotas**

Hranaiova, Jana; Gorter, Harry de

doi:10.1111/j.1467-9396.2005.00538.x

Cited by 7 publications

(5 citation statements)

References 22 publications

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“…The inefficiency depicted in equation (7) can occur for numerous reasons such as trade restrictions, public price support and non‐competitive pricing practices (Baulch, ; Hranaiova and de Gorter, ). These equations can also be re‐written in terms of rents R t , which are equal to, less than or greater than zero for the above three cases, respectively.

R_{t} = P_{t}^{CH} - P_{t}^{IT} - T C_{t}

Such rents only explain the spatial efficiency or inefficiency between two markets and do not account for trade flows.…”

Section: Methodsmentioning

confidence: 99%

Market Integration and Market Efficiency under Seasonal Tariff Rate Quotas

Hillen¹

2019

J Agricultural Economics

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Switzerland applies seasonal tariff rate quotas (TRQs) for the import of many fruits and vegetables during the domestic harvest season. We examine how this system affects the relationship between Italian and Swiss tomato prices and test for physical market integration and spatial equilibrium conditions over time. We use detailed, transaction-based data on trade flows and trade costs and estimate an extended parity bounds model, following Barrett and Li (2002). We confirm that in the summer season, when TRQs are in place, markets are inefficient. While quota holders receive positive rents, the marginal rents for importers without quota shares are negative. This inhibits trade flows above the in-quota import quantity allowed by TRQs. Hence, despite leading to inefficiencies and creating rents for importers, seasonal TRQs are effective in protecting domestic production against competing imports.

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R_{t} = P_{t}^{CH} - P_{t}^{IT} - T C_{t}

Such rents only explain the spatial efficiency or inefficiency between two markets and do not account for trade flows.…”

Section: Methodsmentioning

confidence: 99%

Market Integration and Market Efficiency under Seasonal Tariff Rate Quotas

Hillen¹

2019

J Agricultural Economics

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“…In particular, a varying degree of redistribution efficiency can reflect different degrees of rent-seeking activity or administrative waste. Rent-seeking can occur both under tariffs and other barriers, see Hranaiova and De Gorter (2005) for an analysis in the context of quotas and trade licenses. Note also, that an ad valorem tariff when there is no tariff revenue redistribution, captures a class of trade barriers that are real costs but increase in value of the shipment (e.g.…”

Section: Ranking Trade Barriers For Heterogeneous Firms 425mentioning

confidence: 99%

A Welfare Ranking of Multilateral Reductions in Real and Tariff Trade Barriers when Firms are Heterogenous

Schröder

Sørensen

2014

Rev International Economics

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Trade liberalization comes about through reductions in various types of trade barriers. This paper introduces, apart from the customary real trade costs (i.e. iceberg and fixed export costs), two revenue generating trade barriers (i.e. an ad valorem tariff and a trade license) into a standard heterogeneous‐firms‐trade model with Pareto distributed productivities. We derive analytical welfare rankings of all four liberalization channels for an equal effect on two openness measures, for any trade cost level and while all four barriers are simultaneously present, i.e. for any initial equilibrium. We show that when openness is measured at retail prices, not border prices, the welfare rankings are sensitive to the degree of efficiency in revenue redistribution, e.g. the share of tariff revenues wasted on rent‐seeking activities. As a result, multilateral tariff reductions can switch from the least to the most preferred mode of liberalization. Among the other three barriers we establish a universal welfare ranking for any strictly positive level of revenue redistribution and for either measure of openness.

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“…Imperfect information and transaction costs can increase the costs faced by traders and limit the access of some of them to licence allocation. Hraianova and de Gorter (2005) have analysed how the existence of quota rents induces firms to engage in wasteful rent-seeking activities.…”

Section: The Modelmentioning

confidence: 99%

“…The few papers on TRQs that have considered market power in the trading industry (e.g. de Gorter and Boughner, 1999; Gervais and Suprenant, 2000; Hraianova and de Gorter, 2005; Rude and Gervais, 2006) all assume the product to be homogenous and the nature of the competition between firms to be exogenous to the models which, in most cases, is assumed to be à la Cournot, to avoid the Bertrand paradox. Comparative static analysis is performed by holding the mode of competition constant and, thus, implicitly assuming that it is not affected by trade liberalisation.…”

Section: Introductionmentioning

confidence: 99%

The Liberalisation of Tariff Rate Quotas under Oligopolistic Competition

Scoppola

2010

J Agricultural Economics

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Several proposals for liberalising agricultural tariff rate quotas (TRQs) have been proposed within the WTO Doha Development Round. The literature suggests that the effectiveness of liberalisation depends upon which of the three elements of a TRQ constrains imports. Most contributions assume perfect competition. This article uses an oligopoly two-stage capacity constrained model, in which the mode of competition is endogenous, to investigate the impact of different liberalisation options of TRQs, that is, the reduction in the in-quota and out-of-quota tariffs and the expansion of the quota. This article shows that consideration of the nature of competition between traders may provide unconventional conclusions about the effectiveness of the various TRQ liberalisation options; furthermore, the article shows how an increase in the number of rivals, under certain circumstances, may be more effective in increasing trade than reducing tariffs. Copyright (c) 2010 The Author. Journal compilation (c) 2010 The Agricultural Economics Society.

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Rent Seeking with Politically Contestable Rights to Tariff-rate Import Quotas**

Cited by 7 publications

References 22 publications

Market Integration and Market Efficiency under Seasonal Tariff Rate Quotas

Market Integration and Market Efficiency under Seasonal Tariff Rate Quotas

A Welfare Ranking of Multilateral Reductions in Real and Tariff Trade Barriers when Firms are Heterogenous

The Liberalisation of Tariff Rate Quotas under Oligopolistic Competition

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