Icebergs versus Tariffs: A Quantitative Perspective on the Gains from Trade

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Show simple item record Felbermayr, Gabriel de_DE Jung, Benjamin de_DE Larch, Mario de_DE 2013-03-25 de_DE 2014-03-18T10:04:08Z 2013-03-25 de_DE 2014-03-18T10:04:08Z 2013 de_DE
dc.identifier.other 380422891 de_DE
dc.identifier.uri de_DE
dc.description.abstract Recent quantitative trade models treat import tariffs as pure cost shifters so that their effects are similar to iceberg trade costs. We introduce revenue-generating import tariffs, which act as demand shifters, into the framework of Arkolakis, Costinot and Rodriguez-Clare (2012), and generalize their gains from trade equation. Our formula permits easy quantification based on countries’ observed degrees of openness, tariff revenues, and on the gravity elasticities of tariffs and icebergs. Export selection drives a wedge between these two elasticities and matters for welfare gains. However, in all model variants, an analysis based on iceberg costs necessarily underestimates the true gains from trade relative to autarky. Our quantitative exercise suggests that the bias can be numerically significant. For countries with relatively high tariffs, our formula predicts 30-60% larger gains from trade when iceberg trade costs and/or tariffs are liberalized as compared to a pure reduction of iceberg trade costs. en
dc.language.iso en de_DE
dc.publisher Universität Tübingen de_DE
dc.rights ubt-podno de_DE
dc.rights.uri de_DE
dc.rights.uri en
dc.subject.classification Außenhandel de_DE
dc.subject.ddc 330 de_DE
dc.subject.other Gravity Equation , Monopolistic Competition , Heterogeneous Firms , Armington Model , International Trade , Trade Policy , Gains from Trade en
dc.title Icebergs versus Tariffs: A Quantitative Perspective on the Gains from Trade en
dc.type ResearchPaper de_DE
utue.publikation.fachbereich Wirtschaftswissenschaften de_DE
utue.publikation.fakultaet 6 Wirtschafts- und Sozialwissenschaftliche Fakultät de_DE
dcterms.DCMIType Text de_DE
utue.publikation.typ workingPaper de_DE 6747 de_DE
utue.publikation.source University of Tübingen Working Papers in Economics and Finance ; 53 de_DE


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