A Note on Macroeconomic Transmission of Tariffs

Søren Nielsen

No 88-11, Discussion Papers from University of Copenhagen. Department of Economics

Abstract: This article deals with macroeconomic transmission effects of the imposition of tariffs in large countries under different institutional arrangements of the world economy. We employ a symmetric two-country model and study the effects of a tariff on employment, consumer prices and real net income at home and abroad under four regimes charcterized by a fixed or a flexible exchange rate and no or perfect capital mobility. We finally investigate which regime offers the best "protection from beggar-thy-neighbour effects of protection", i.e. implies the smallest negative transmission effect on real net income.

Pages: 14 pages
Date: 1988-09
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Published as: "Effects of macroeconomic transmission of tariffs", in: Singer & Sharma (eds.), Growth and External Debt Management. St. Martin's Press, 1989, pp. 211-219

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Persistent link: https://EconPapers.repec.org/RePEc:kud:kuiedp:8811

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