Tariffs: These are import duties, such as the
customs and excise duties of the United Kingdom. These have the
effect of raising the price of the imported goods and therefore making them
less competitive when compared to home products.
Subsidies: These are given to home producers, which
makes their goods cheaper and therefore more competitive when compared with the
prices of overseas products.
Quotas: These are physical restrictions on the
amount of goods that can be imported into a country over a period of time. For
example, the United Kingdom
has set a limit on the number of Japanese cars that can be imported into the United Kingdom.
Embargoes: These are bans on importing certain
items from overseas.
Reasons for restricting trade:
·
To raise revenue from tariffs.
- To protect existing industries from overseas competition.
- To protect infant industries which are not yet strong enough to compete with established overseas firms.
- To restrict dumping of foreign goods.
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