Chapter 9: Nontariff Barriers to
Imports
McGraw-Hill/Irwin
Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
9.1 Introduction
 Chapter Objective
To examine the major
kinds of nontariff barriers
and their effects.
McGraw-Hill/Irwin
Copyright 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
 Contents
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


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Import Quotas
Voluntary Export Restraints
Product Standards
Domestic Content Requirements
Government Procurement
Measurement of Costs of Protection
9-3
9.2 Import Quota
配额
 Import quota
进口配额
 Tariff-rate quota
关税配额
 Global quota
全球配额
 Country-specific quota
国别配额
9-4
 Effects of a quota
in a Small Country
PY
Sd
Sd+q
quota
b
C:
quota
rents
P1
P0
a
c
d
SW
Dd
O
Y1 Y3
Y2 Y0
Y
9-5
Who gets the quota rents?
 Importers
Fixed Favoritism
Free assignment of quotas
to importers on the basis
of
past performance
9-6
Who gets the quota rents?
 Government
Public Auction

Auction “under the
table”
Net welfare effect: - ( b+d )
9-7
Who gets the quota rents?
 Importers (partly)
Resource-using Procedures
First come, first serve
Demonstrating need or
worthiness
 Negotiation


Net welfare effect: - ( b+d+c ) ?
9-8
 Effects of a Quota
in a Large Country
PY
Sd
q
P1
P0
P2
b
a
c
Y1 Y3
SW
d
Optimal
Quota
e
O
Sd+q
Dd
Y2
Y0
Y
9-9
Net welfare effect for a
large country:
e - ( b+d )
Nationally Optimal Quota
9-10
Welfare Loss for the World:
（ｂ＋ｄ）＋ｆ
9-11
 Comparison of Tariffs
and Quotas
 Equivalence of tariffs and quotas
 Differences
 Tariff Revenue vs. Quota Rents
 Protective effects
 Damaging effects on the economy
(Monopoly and Efficiency)
9-12
9.3 Voluntary Export Restraints
自愿出口限制
 Are VERs voluntary ?
 History
1981: Japanese VER on car
exports
to the USA, 1.8 million per
year
 Multilateral Discipline
According to the Agreement
on
9-13
 Effects of VERs
 Similar to those of Quotas
 Quota rents to be captured
by the exporting firms or
their government.
9-14
Effects of VERs
in a Small Country
PY
Sd
Sd+q
VER quota
b
Export
Price
P1
P0
a
c
d
SW
Dd
O
Y1 Y3
Y2 Y0
Y
9-15
Effects of VERs
 Total losses for the importing
country: b+c+d
 Worse than quotas
9-16
Effects of U.S. Auto VER
 Loss in consumer surplus:
USD 13 billion
 Net national loss:
USD 3 billion
9-17
Other Effects of VERs
 Quality Upgrading
 Foreign Direct Investments
9-18
9.4 Product Standards
产品标准
Technical Barriers to Trade
技术贸易壁垒 TBT
 Standards
 Certification
9-19
9.5 Domestic-Content
Requirements
当地成分要求
China: Imports of Car Parts
Tariff: car 25%
car parts 10%
 Mixing Requirement
9-20
9.6 Government Procurement
政府采购
Buy American Act 1933
 6% margin preference for US goods
 50% for military goods
WTO : 1979; 1994
Government Procurement Agreement
Plurilateral agreement.
9-21
9.7 Measurement of Costs of
Protection
 Costs as a Percentage of GDP
The case of a small country
9-22
Net national loss / GDP
= 1/2 X Tariff rate
X Percent reduction in import quantity
X Import value / GDP
9-23
Example
 Import tariff : 10%
 Import quantities reduced: 20%
 Imports / GDP: 20%
 Net national loss / GDP = 0.2%
9-24
China (2005)
 Import tariff : 9.9%
 Import quantities reduced: 20%
 Imports / GDP:
660/2251(bln)= 29%
 Net national loss / GDP = 0.29%
 Net national loss: RMB 52.9 bln
9-25
Actual costs may be higher
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Foreign retaliation
Enforcement costs
Rent-seeking costs
Rents to foreign producers (VER)
Innovation
9-26
9-27
 Reducing protection:
The role of GATT/WTO
 General Agreement on Tariffs
and Trade (GATT) 1947
 Tokyo Round 1973-1979
 Uruguay Round 1986-1993
 Doha Round 2001-
9-28
 U.S. Unilateral Action
 Section 301
Unfair trade
(1974)
 Super 301
(1988)
Trade Barriers
 Special 301 (1998)
Intellectual Property Rights
Watch List; Priority Watch List
9-29
Special 301 Priority Watch List
2004
ARGENTINA
KUWAIT
BAHAMAS
LEBANON
BRAZIL
PAKISTAN
EGYPT
THE PHILIPPINES
EUROPEAN UNION
INDIA
RUSSIA
INDONESIA
TAIWAN
KOREA
TURKEY
9-30
重点观察名单2010

中国、俄罗斯、阿尔及利亚、
阿根廷、加拿大、智利、印度、
印尼、巴基斯坦、泰国、委内
瑞拉
9-31
Summary
9-32
9-33
9-34
9-35
9-36
9-37
9-38
9-39