Local impacts of trade liberalization: evidence from the chilean agricultural sector

Protectionist trade policies aim at shielding some sectors— typically but not exclusively manufacturing—from international competition. In doing so they may produce unintended consequences. In particular they tend to create some taxed sectors that use protected inputs usually in the agricultural sec...

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Detalles Bibliográficos
Autores principales: Cuesta, José Ignacio, Gallego Yáñez, Francisco, González, Felipe A.
Formato: Artículo
Lenguaje:eng
Publicado: Banco Central de Chile 2019
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Acceso en línea:https://hdl.handle.net/20.500.12580/3832
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Sumario:Protectionist trade policies aim at shielding some sectors— typically but not exclusively manufacturing—from international competition. In doing so they may produce unintended consequences. In particular they tend to create some taxed sectors that use protected inputs usually in the agricultural sector which end up facing a negative effective rate of protection (ERP hereafter). In this way protectionism distorts the allocation of resources and creates disincentives for the production of some goods. This was the case of the tariff structure in Chile before the massive process of economic and trade liberalization that began in the mid-1970s.