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Tariffs, Growth and Non-Tariff Transport Costs

Author

Listed:
  • Wataru Johdo

    (Department of Economics, Tokyo Keizai University, 1-7-34, Minami-cho, Kokubunji-shi, Tokyo 185-8502, Japan)

Abstract

This paper examines the impact of unilateral tariff increases on the world growth rate using a two-country endogenous growth model when firms are internationally mobile, technical knowledge in research and development is an international public good, and iceberg transport costs are not subject to tariffs. In this paper, we find that a unilateral tariff increase in one country raises or lowers the world growth rate, depending on the degree of elasticity of substitution between any two differentiated goods and the share of firms owned by the country that raised tariffs.

Suggested Citation

  • Wataru Johdo, 2024. "Tariffs, Growth and Non-Tariff Transport Costs," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 15(03), pages 1-21, October.
    • Handle: RePEc:wsi:jicepx:v:15:y:2024:i:03:n:s1793993324500236
    DOI: 10.1142/S1793993324500236
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    More about this item

    Keywords

    Non-tariff iceberg transport cost; tariff; international mobility of firms; growth;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • F1 - International Economics - - Trade
    • F2 - International Economics - - International Factor Movements and International Business
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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