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Modeling of Duty Drawback by Means of Domestic Final Consumption Subsidy

Markus Lips, Andrzej Tabeau and Frank van Tongeren

No 331179, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: We suggest an approach to take the Duty Drawback regime into account in a general equilibrium frame. A change of tariffs is imitated by a virtual subsidy for domestic consumers. The approach is based on a specific shock calculation and requires neither a change of the general equilibrium model nor an adjustment of the database. As an illustrative example we analyze a tariff reduction comparing the suggested approach with a normal application. Model results show clearly that the Duty Drawback regime has a considerable influence.

Keywords: Research Methods/Statistical Methods; Consumer/Household Economics (search for similar items in EconPapers)
Pages: 21
Date: 2004
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