1887

Export Taxes on Primary Products

A Policy Instrument in International Development

image of Export Taxes on Primary Products

English

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Theoretical Framework

A case for an export tax policy can be made using the concept of optimum tariff and this is shown in section (a) below. It can also be argued that for activities which generate economic rent (as described in paragraph 2.9 below) because of market imperfections and differential resource endowments, a larger share of these rents can be retained in the producing countries through the levy of export taxes. The latter approach is discussed in section (b).

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