Maximum-Revenue Tariffs versus Free Trade

Collie, David R. ORCID: https://orcid.org/0000-0002-3132-648X 2020. Maximum-Revenue Tariffs versus Free Trade. Scottish Journal of Political Economy 67 (4) , pp. 442-447. 10.1111/sjpe.12245

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Abstract

Welfare with the maximum‐revenue tariff is compared to free‐trade welfare under Cournot duopoly with differentiated products; under Bertrand duopoly with differentiated products; and under perfect competition in the case of a large country able to affect its terms of trade. Under Cournot duopoly and Bertrand duopoly, assuming linear demands and constant marginal costs, welfare with the maximum‐revenue tariff is always higher than free‐trade welfare. Under perfect competition, assuming linear demand and supply, welfare with the maximum‐revenue tariff will be higher than free‐trade welfare if the country has sufficient market power.

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Publisher:	Wiley
ISSN:	0036-9292
Date of First Compliant Deposit:	15 April 2020
Date of Acceptance:	26 March 2020
Last Modified:	05 May 2023 00:42
URI:	https://orca.cardiff.ac.uk/id/eprint/130608

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