Common External Tariff Choice in Core Customs Unions

Mark Melatos and Alan Donald Woodland ()

Review of International Economics, 2009, vol. 17, issue SI, pages 292-303

Abstract: This paper investigates how customs union members select the common external tariff (CET) to levy on imports from nonmembers. A perfectly competitive, pure exchange, general-equilibrium model of world trade is simulated. Contrary to most previous work, countries have the freedom to share authority over CET choice and to select from a variety of possible coalition forms. The results confirm that when customs unions are observed in the core, members may wish to share responsibility for CET choice in a variety of ways. Generally, however, the member country that is relatively well-endowed or has relatively elastic consumer preferences tends to take the lead in CET choice. Copyright 2009 The Authors. Journal compilation 2009 Blackwell Publishing Ltd.

Date: 2009

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