The Structure of Tariffs and Long-Term Growth
Citation
Nunn, Nathan, and Daniel Trefler. 2010. “The Structure of Tariffs and Long-Term Growth.” American Economic Journal: Macroeconomics 2 (4) (October): 158–194. doi:10.1257/mac.2.4.158. http://dx.doi.org/10.1257/mac.2.4.158.Abstract
We show that the "skill bias" of a country's tariff structure is positively correlated with long-term per capita GDP growth. Testing for causal mechanisms, we find evidence consistent with the existence of real benefits from tariffs focused in skill-intensive industries. However, this only accounts for a quarter of the total correlation between skill-biased tariffs and growth. Turning to alternative explanations, we extend the standard Grossman-Helpman "protection-for-sale" model and show how the skill bias of tariffs can reflect the extent of domestic rent-seeking activities in the economy. We provide evidence that the remaining variation is explained by this endogeneity.Terms of Use
This article is made available under the terms and conditions applicable to Other Posted Material, as set forth at http://nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of-use#LAACitable link to this page
http://nrs.harvard.edu/urn-3:HUL.InstRepos:11986329
Collections
- FAS Scholarly Articles [18256]
Contact administrator regarding this item (to report mistakes or request changes)