rent-seeking, trade policy and economic welfare寻租、贸易政策和经济福利.pdf

Modern Economy, 2011, 2, 31-38 doi:10.4236/me.2011.21005 Published Online February 2011 (http://www.SciRP.org/journal/me) Rent-Seeking, Trade Policy and Economic Welfare 1 2 Fernando Antônio Ribeiro Soares , Tito Belchior Silva Moreira 1 Brazilian Ministry of Defense, Brasília, DF, Brazil 2Department of Economics, Catholic University of Brasília, Brasília, DF, Brazil E-mail : fernando.a.r.soares@, tito@pos.ucb.br Received December 6, 2010; revised December 25, 2010; accepted December 30, 2010. Abstract The objective of this paper is to assess the impacts that rent-seeking arising from government intervention in international trade has on welfare. More specifically, the focus is on how the granting of special import re- gimes promotes rent-seeking practices, which have negative effects on welfare. We present two concepts of nominal protection: legal tariffs and the actual import tariffs. In addition, we construct three measures of welfare: from the legal tariff; from the actual import tariffs; and from the actual import tariffs when rent-seeking is present. Finally, we compare the various measures of protection in terms of their impact on welfare. The results show that trade policies based on exceptions - such as those establishing the special im- port regimes - tends to decrease welfare. Keywords: Legal Tariffs, Actual Import Tariffs, Welfare, Rent-Seeking 1. Introduction special regimes. As observed by [7], there would be re-