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Tariffs and Wages in Trade Theory
Author(s) -
Thompson Henry
Publication year - 2016
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/rode.12233
Subject(s) - economics , presumption , imperfect competition , trade theory , general equilibrium theory , perspective (graphical) , competition (biology) , new trade theory , gains from trade , microeconomics , free trade , trade barrier , international economics , ecology , artificial intelligence , political science , computer science , law , biology
The theory of production and trade is motivated in large part by the effects of tariffs on wages. General equilibrium models that examine these effects include constant costs, factor proportions, specific factors, imperfect competition and noncompetitive factor market. The present paper reviews the effects of tariffs on wages in small open economies across this broad range of trade theory. From this wide perspective, tariffs support wages only under narrow sets of assumptions. There should be no presumption that tariffs support wages.