Strategic and rent extracting tariffs in the presence of persuasive advertising

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Title: Strategic and rent extracting tariffs in the presence of persuasive advertising
Authors: Leahy, Dermot
Permanent link: http://hdl.handle.net/10197/1744
Date: Dec-1993
Abstract: This paper examines positive and normative implications of tariffs in the presence of persuasive advertising. It demonstrates that protection affects imports, the domestic consumer price and the terms of trade directly and through its effect on the level of advertising. If protection reduces advertising a Metzler paradox can occur. A tariff can be used to induce foreigners to allow entry. Jointly optimal tariffs and advertising taxes and the optimal tariff for the situation when it is the only available policy instrument are derived under both monopoly and Cournot oligopoly.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Keywords: Persuasive advertising;Tariffs;Oligopoly;Entry
Subject LCSH: Advertising--Economic aspects
Tariff
Trade regulation
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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