Other Barriers to Trade
While this chapter has mainly spoken of tariffs, most points apply equally well to any other impediments ‘to trade. Quotas have much the same effects as tariffs, for they prevent the comparative advantages of different countries from determining prices and outputs in the marketplace. In recent years, countries have negotiated quotas with other countries.
The United States. for example, forced japan to put “voluntary”. export quotas on automobiles and negotiated similar export quotas on televisions, shoes, and steel How important are the non tariff barriers relative to tariffs? Economic studies indicate that non tariff barriers were actually more important than tariffs during the 19605 because of a quota on oil imports; in recent years, they have effectively doubled the protection found in the tariff codes. In a sense, non tariff barriers have been substitutes for more conventional tariffs as the latter have been reduced.