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Chapter 6 Nontariff Barriers - Coggle Diagram
Chapter 6 Nontariff Barriers
Types of Nontariff Barriers
Import Quotas
An import quota is a type of trade restriction that sets a physical limit on the quantity of a good that can be imported into a country in a given period of time. Quotas, like other trade restrictions, are typically used to benefit the producers of a good in that economy.
Voluntary Export Restraints (VERs)
A voluntary export restraint or voluntary export restriction is a government-imposed limit on the quantity of some category of goods that can be exported to a specified country during a specified period of time.
Domestic Content Requirement
ensure that the government's renewable energy policy produces tangible local economic benefits.
Export Subsidies
Export subsidy is a government policy to encourage export of goods and discourage sale of goods on the domestic market through direct payments, low-cost loans, tax relief for exporters, or government-financed international advertising
Technical, Administrative & Other Regulations
Health and safety regulations may serve as barriers to international trade by raising the costs of imported products
Government purchasing restrictions may be biased against foreign goods (The Buy American Act of 1933)
Rebates for indirect taxes may be given to exporters and imposed on importers of a commodity
Antidumping Duties
The export of a commodity at below cost, or the sale of a commodity at a lower price abroad than domestically
Three types of dumping (persistent, predatory and sporadic
Persistent dumping – continuous tendency of a domestic monopolist to maximize total profits by selling the commodity at a higher price in the domestic market
International Cartels
An international cartel is an arrangement to avoid some or all forms of competition, the parties to which are business enterprises domiciled under more than one government and trading across national frontiers.
key points
A nontariff barrier is a trade restriction–such as a quota, embargo or sanction–that countries use to further their political and economic goals.
Countries usually opt for nontariff barriers (rather than traditional tariffs) in international trade.
Nontariff barriers include quotas, embargoes, sanctions, and levies.
A nontariff barrier is a way to restrict trade using trade barriers in a form other than a tariff. Nontariff barriers include quotas, embargoes, sanctions, and levies.