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Effective Rates of Protection When Domestic and Foreign Goods Are Imperfect Substitutes: The Case of Thailand

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  • Devarajan, Shantayanan
  • Sussangkarn, Chalongphob

Abstract

Noting that standard calculations of effective rates of protection assume that domestic and foreign goods are perfectly substitutable, this paper relaxes that assumption. Using a fifty-four sector, general equilibrium model of Thailand, the authors compute effective rates of protection when the imported and domestically-produced good in each sector are assum ed to be imperfect substitutes and compare them with the effective rates of protection as derived using the standard approach. Their results show that the general-equilibrium calculation differs from the standard one not ju st in the ranking and magnitude of the effective rates of protection but sometimes even in the sign. Copyright 1992 by MIT Press.

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  • Devarajan, Shantayanan & Sussangkarn, Chalongphob, 1992. "Effective Rates of Protection When Domestic and Foreign Goods Are Imperfect Substitutes: The Case of Thailand," The Review of Economics and Statistics, MIT Press, vol. 74(4), pages 701-711, November.
    • Handle: RePEc:tpr:restat:v:74:y:1992:i:4:p:701-11
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    Cited by:

    1. Henning Tarp Jensen & Sherman Robinson & Finn Tarp, 2010. "Measuring Agricultural Policy Bias: General Equilibrium Analysis of Fifteen Developing Countries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(4), pages 1136-1148.
    2. Taran Fæhn, 2002. "The Qualitative and Quantitative Significance of Non-Tariff Barriers: An ERP study of Norway," Economic Systems Research, Taylor & Francis Journals, vol. 14(1), pages 35-57.
    3. Devarajan, Shantayanan & Robinson, Sherman, 2013. "Contribution of Computable General Equilibrium Modeling to Policy Formulation in Developing Countries," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 277-301, Elsevier.
    4. Merle Holden, 2001. "Effective Protection Revisited: How Useful A Policy Tool For South Africa?," South African Journal of Economics, Economic Society of South Africa, vol. 69(4), pages 659-673, December.
    5. Njinkeu, Dominique, 1996. "Evaluation of the incentive structure: A survey and application to Cameroon," World Development, Elsevier, vol. 24(3), pages 557-568, March.
    6. Jensen, Henning Tarp & Robinson, Sherman & Tarp, Finn, 2002. "General equilibrium measures of agricultural policy bias in fifteen developing countries," TMD discussion papers 105, International Food Policy Research Institute (IFPRI).
    7. Jean, Sébastien & Bureau, J.C., 2008. "Assessing the Trade Creation Effect of EU Bilateral Trade Agreements," Conference papers 331727, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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