Author Question: Explain why a government would impose an import tariff when domestic consumers suffer more than ... (Read 263 times)

KWilfred

  • Hero Member
  • *****
  • Posts: 570
Explain why a government would impose an import tariff when domestic consumers suffer more than producers gain.
 
  What will be an ideal response?

Question 2

Supporters of import restrictions and protectionist policies place greater weight on producer welfare than on consumer welfare. Comment.
 
  What will be an ideal response?


ebonylittles

  • Sr. Member
  • ****
  • Posts: 318
Answer to Question 1

The tariff may be a product of producer rent seeking. Each producer will gain a relatively large amount compared to the loss of each consumer. The producers may be able to coordinate their rent seeking activities. Each consumer will only lose a relatively small amount so it is unlikely that consumers will coordinate a protest to the tariff.

Answer to Question 2

Import restrictions increase the producer surplus of domestic producers. Consumer surplus, however, decreases by more than producers gain. Thus, the statement seems to be correct.



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question


 

Did you know?

Anesthesia awareness is a potentially disturbing adverse effect wherein patients who have been paralyzed with muscle relaxants may awaken. They may be aware of their surroundings but unable to communicate or move. Neurologic monitoring equipment that helps to more closely check the patient's anesthesia stages is now available to avoid the occurrence of anesthesia awareness.

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

Did you know?

There are immediate benefits of chiropractic adjustments that are visible via magnetic resonance imaging (MRI). It shows that spinal manipulation therapy is effective in decreasing pain and increasing the gaps between the vertebrae, reducing pressure that leads to pain.

Did you know?

Approximately 15–25% of recognized pregnancies end in miscarriage. However, many miscarriages often occur before a woman even knows she is pregnant.

For a complete list of videos, visit our video library