PS 341 Lecture Notes - Lecture 2: Common External Tariff, Kyoto Protocol, French Wine
13 Nov 2018
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Document Summary
In a free trade area national tariffs and quotas are eliminated on trade between the participating countries but maintained on trade with third countries. Barriers to trade are not only economic tariffs, but could be legal things as well. Ex: regulation on cars, certain level of pollution and quality of brakes different regulations in different countries ( we have negotiated common standards to avoid adaptation to diff. countries) Ex: kyoto protocol introduced standards of our environmental effects by industry. Nafta us blacked import of tuna b/c it claimed it did not follow environmental law of the us mexico argued that it was protectionism. In a customs union countries remove barriers to trade and adopt a common external tariff towards third countries. Strong political instrument: if this is made by a large market ex. The eu adopts a common external markets towards china for china this could be a big problem. Gives leverage with the rest of the world.
