Export Policies Part 2

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International Trade at Cleveland State University

International Trade at Cleveland State University

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@raihankhan4374
@raihankhan4374 4 жыл бұрын
I don’t understand something. Just for context first: If exporters are selling more to the world market at Pw* but are okay with that because they are actually receiving Pw* + S...and so to avoid home firms from selling ONLY to foreign consumers the government enforces a tariff to rise home prices....but there are people on the world market receiving pw* why don’t home consumers just import from them and not from home firms? Is it because the Home consumers are the ones that have to pay the tariff? if that’s the case then why does a tariff increase the MC of an exporter if consumers are the ones paying the tariff? Or is it because the tariff scares away other foreign exporters from selling to home consumers leaving home consumers to only buy from home firms at the higher price?
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