Examining Restraints on Trade
Tariffs–customs duties–on imported products in the OECD area are on a downward trend and, with some important exceptions, are currently fairly low. By contrast, non-tariff barriers (NTBs) applied at borders, such as ‘voluntary’ export restraints and anti-dumping and countervailing actions, may be assuming relatively more importance as a means of protecting domestic industry.
NTBs, just like tariffs, tend to increase the prices paid by consumers. They can also entail potentially serious losses of efficiency and welfare. For a relatively small country, those welfare losses are confined largely to the country imposing the protective measures. But tariffs and NTBs used by major traders, chiefly the United States, the European Union, Japan and Canada, can also have serious repercussions on their trading partners and thus provoke retaliation.
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