IMPORT QUOTAPresenter: Tran Vo Ngoc Chau

OUTLINE

1 – Definition and Purposes

2 – Effect

3 – Classification

4 – Import Quota vs Tariff

5 – Summary

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary What is import quota?

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Filling the gaps, using : encourage, reduce

Import quotas are used to (1)…..the imports and (2) …. domestic buyers to purchase products from domestic producers.

1.Reduce 2.Encourage

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Protect domestic industries and employment

Protect against unfair trade practices

Protect national security

Look at three pictures and match them with three reasons

explaining the use of import quotas.

Demand

Supply

Pw

Price

Demand

Supply

Pw

Price

Quantity Quantity

PA

QAQw

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Demand

Supply

Pw

Price

Quantity

60

40Pd

40Q1 Q2 Q3 Q4

a b c

= consumer loss (a + b + c + d)

= producer gain (a)

= quota quantity (c)

1

a

cd

Which are quota quantity, producer gain , consumer loss ?

1

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Difference

Import Quota

Absolute Quota CANNOT import above the limit

Tariff-rate Quota

CAN import above the specified quantity with higher tariff

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Name 4 items that Vietnamese government apply tariff-rate quota?

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Features Tariff Import Quota

Decrease welfare of domestic consumers    

The government can directly control the imports    

Raising tax for the government    

Can lead to administrative corruption    

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Which feature belongs to tariff, import quota or both ?

Definition and Purposes

Effects

Classification

Import Quota vs Tariff

Summary

Purpose

Disadvantages

Advantages

Classification

Import Quotas

(5)…………. (not limit the quantity)

Limit the (1)……………..

Reduce dependence on other nations

Raise no revenue from the imports

Protect (2)……………...industries

May cause (3)……….

(4)……….. (limit the quantity)

Gap fillingcorruptio

ntariff rate

quotaabsolute

quotaimports domesti

c

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