International Agricultural Trade
WTO and Trade Polices
This is an optional homework, meaning that you can choose to submit the assignment. However, if you submit the assignment, it will be graded and factored into your homework grade.
1. Explain the difference between a small nation and large nation importer both in words and diagrammatically (use two-panel diagrams).
2. Analyze the welfare effects of a per unit import tariff imposed by a large nation importer using a two-panel diagram. Be sure to show changes in consumer surplus and producer surplus, social losses (deadweight cost, deadweights cost of overproduction and under consumption), tariff revenue, consumption distortion, production distortion, and trade distortion on your diagram.
3. Analyze the welfare effects of an import quota imposed by a large nation importer using a two-panel diagram. Be sure to show changes in consumer surplus and producer surplus, social losses (deadweight cost, deadweights cost of overproduction and under consumption), quota rents, consumption distortion, production distortion, and trade distortion on your diagram.
4. Analyze the welfare effects of an import quota imposed by a small nation importer using a two-panel diagram. Be sure to show changes in consumer surplus and producer surplus, social losses (deadweight cost, deadweights cost of overproduction and under consumption), quota rents, consumption distortion, production distortion, and trade distortion on your diagram.
5. Discuss the tariffication process and the problems associated with it.