Embed Size (px)
DESCRIPTION
Griffin ib7 inppt_09
Citation preview
Chapter 9
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 1
Formulation of National Trade Policies
Learning Objectives
• Review pros and cons of governmental
intervention in international trade
• Identify advantages and disadvantages
of adopting an industrial policy
• Analyze how domestic politics affect a
country’s international trade policies
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 2
Learning Objectives
• Describe the major tools countries use to
restrict trade
• Specify the techniques countries use to
promote international trade
• Explain how countries defend against
unfair trade practices
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 3
Rationale for Trade Intervention
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 4
Trade Policy Debate
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 5
Free Trade
Fair Trade
Industry Arguments
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 6
National
DefenseInfant Industries
Strategic Trade
Theories
Maintenance
of Jobs
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 7
National Defense
•Raw Materials
•Machinery
•Technology
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 8
Government Protection
Comparative Advantage
Infant Industries
Maintenance of Jobs
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 9
Existing Levels
of Employment
Relief from
Competition
Strategic Trade Theory
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 10
Oligopolistic Industries
Government
Intervention
Requests for
Protection
Payoff Matrix: Profits from Developing a Nuclear Power Plant Design
(in billions of USD)
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 11
Are
va
Develop
Do NotDevelop
Develop Do Not DevelopToshiba
-1
-1 10
0
10
0
0
0
Payoff Matrix: Profits Resulting from a $2 Billion Subsidy to Areva
(in billions of USD)
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 12
Are
va
Develop
Do NotDevelop
Develop Do Not DevelopToshiba
-1
-1 + 2 = +1 10 + 2 = 12
0
10
0
0
0
Summary of Discussion
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 13
Advantages and Disadvantages of Adopting
an Industrial Policy
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 14
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 15
Economic Development
•Export Strategy
•Import Strategy
Industrial Policy
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 16
Opportunities Challenges
Key Industries
Competitiveness
Politicians
Special Interests
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 17
Public Choice Analysis
•Interest Groups
•Elected Officials
Summary of Discussion
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 18
Barriers to International Trade
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 19
Tariff Barriers
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 20
•Export Tariffs
•Transit Tariffs
•Import Tariffs
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 21
Three Import Tariffs
Heading/
Subheading
Stat.
Suffix Article Description
Units of
Quantity Rates of Duty
2006.00 Fruit, nuts, fruit peel, other plant parts,
preserved by sugar
2006.00.20 00 Cherries Kg 9.9¢/kg + 6.4%
2006.00.30 00 Ginger Root Kg 2.4%
2006.00.40 00 Pineapples Kg 2.1%
Other, including mixtures:
2006.00.50 00 Mixtures Kg 16%
2006.00.60 00 Citrus Fruit; Peel of citrus or other fruit kg 6¢/kg
2006.00.70 00 Other Fruit and Nuts Kg 8%
2006.00.90 00 Other kg 16%
Impact of an Import Tariff on Demand for U.S. Made SUVs
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 22
Gainers: Producers, suppliers,
labor, dealers & communities
associated with U.S. SUVs
Losers: Domestic consumers,
workers, producers & dealers
associated with Foreign SUVs
Nontariff Barriers
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 23
Numerical Quotas
Numerical Export Controls
Other Nontariff Barriers
Numerical Quotas
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 24
Tari
ff r
ate
on
wid
gets
Number of widgets
100,000
Imports above thresholdQuota threshold
0
TL
TH
Numerical Export Controls
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 25
Quantitative Trade Barriers
Voluntary Export
Restraint
Embargos
and Bans
• Product and Testing Standards
• Restricted Distribution-Network Access
• Public-Sector Procurement Policies
• Local-Purchase Requirements
• Regulatory and Currency Controls
• Investment Controls
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 26
Other Nontariff Barriers
Summary of Discussion
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 27
Promotion of International Trade
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 28
Government Subsidies
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 29
Opportunities Challenges
Export Markets
Foreign Imports
Trade Patterns
Efficient Producers
Foreign Trade Zones
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 30
Preferential Tariff Treatment
Economic
Development
Customs
Duties
Export Financing Programs
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 31
Government-Owned Agencies
Export-Import Bank of the U.S.
Overseas Private Investment Corp.
Summary of Discussion
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 32
Controlling Unfair Trade Practices
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 33
Unfair Trade Practices
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 34
International
Trade
Administration
(ITA)
International
Trade
Commission
(ITC)
Countervailing Duty
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 35
Foreign
Subsidy
Ad Valorem
Tariff
Antidumping Laws
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 36
•Price Discrimination
•Predatory Pricing
Unfair Trade Laws
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 37
Opposition to Enforcement
Protectionist
Trade Barriers
Harm to
Consumers
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 38
Sudden Import Surges
Safeguards
Summary of Discussion
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 39
Chapter 9
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 40
Formulation of National Trade Policies
Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Chapter 9 - 41
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.
