A Rationale for Quota Protection: A Political Economy Approach

Jay Choi

Eastern Economic Journal, 1996, vol. 22, issue 4, 421-424

Abstract: This paper provides a political economy rationale for quota protection in declining industries. When the government maximizes a Stigler-Peltzman type political support function, a quota may have a political advantage over a tariff in that the level of the quota, once it is implemented, does not need to change. A tariff, however, requires constant readjustment in order to sustain the same static political-support-maximizing price. This asymmetry in the transparency of protection can make quota protection more appealing to policymakers than the equivalent tariff protection.

Keywords: Protection; Quotas; Tariff (search for similar items in EconPapers)
JEL-codes: F13 (search for similar items in EconPapers)
Date: 1996
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eej:eeconj:v:22:y:1996:i:4:p:421-424

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