Variable demand elasticities and tariff liberalization

• 成果类型: Article
• 署名作者: Spearot, Alan C.
• 署名单位: University of California System; University of California Santa Cruz
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2012.05.012
• 发表日期: 2013
• 页码: 26-41
• 关键词: Firm heterogeneity; Variable elasticities; trade liberalization; Non-discrimination

摘要

This paper examines tariff liberalization within an environment of heterogeneous demand elasticities. Varieties produced at a lower cost (a) are imported at lower absolute demand elasticities and (b) earn higher revenues. By virtue of larger demand elasticities, low revenue varieties benefit the most from tariff liberalization. Further, if varieties are substitutable, low revenue varieties benefit at the expense of high revenue varieties. These predictions are confirmed using a case study of US Uruguay Round ad-valorem tariff cuts, where within exporter-industry groups, low revenue varieties experienced large gains, and high revenue varieties experienced negligible gains. Further, I find evidence suggesting that these effects were also relevant for other trade shocks, such as exchange rates and specific tariffs. (C) 2012 Elsevier B.V. All rights reserved.