Import quota analysis

8051 Words33 Pages
An import quota is a limit on the quantity of a good that can be produced abroad and sold domestically. It is a type of protectionist trade restriction that sets a physical limit on the quantity of a good that can be imported into a country in a given period of time. If a quota is put on a good, less of it is imported. Quotas, like other trade restrictions, are used to benefit the producers of a good in a domestic economy at the expense of all consumers of the good in that economy.
Import Quotas are a type of Non- Tariff Barrier to trade. Non-tariff barriers to trade (NTBs) are trade barriers that restrict imports but are not in the usual form of a tariff. Some common examples of NTB 's are anti-dumping measures and
…show more content…
Any barrier to trade will create an economic loss, as it does not allow markets to function properly. The lost revenues resulting from the barrier to trade can be called an economic loss.
Examples of Non-Tariff Barriers to Trade
Non-tariff barriers to trade can be the following:
Import bans
Quality conditions imposed by the importing country on the exporting countries
Labeling conditions
Complex regulatory environment
Determination of eligibility of an exporting country by the importing country
Determination of eligibility of an exporting establishment (firm, company) by the importing country.
Occupational safety and health regulation
Import licenses
State subsidies, procurement, trading, state ownership
Export subsidies
"Buy national" policy
Over-valued currency
There are several different variants of division of non-tariff barriers. Some divide between internal taxes, administrative barriers, health and sanitary regulations and government procurement policies. Others divide non-tariff barriers into more categories such as specific limitations on trade, customs and administrative entry procedures, standards, government participation in trade, charges on import, and other categories.
The first category includes methods to directly import restrictions for protection of certain sectors
Get Access