Social Sciences and History / Unit 15 SSH 1430 worked example, 60 to 90 seconds
Tariffs, Quotas, Nontariff Barriers: Naming the Tool
The idea
The exam describes a restriction on imports and asks its name, and the anchor's three tools are the set. A tariff is a tax on imported goods, raising their price. An import quota is a numerical limit on the quantity that can be imported. A nontariff barrier is any rule, regulation, inspection or paperwork drawn up to make importing costlier or harder. Whichever tool is used, restricting imports is protectionism, and its effect is the same: the domestic price rises, consumers pay more and producers earn more, an indirect subsidy from consumers to producers. Anti-dumping laws block imports sold below the cost of production and impose tariffs to raise them to that cost.
In practice
Given "a twenty percent duty on imported steel", tariff. Given "no more than ten thousand cars may enter this year", quota. Given "every shipment must pass a month-long inspection", nontariff barrier. Given "a duty on foreign steel found to sell below its production cost", anti-dumping. Ask whether the restriction is a price, a number, or a procedure.
Where people slip
The trap is thinking a quota is free because no tax is collected; the price rises either way, and the anchor's subsidy runs from consumers regardless of tool. The second trap is the WTO's safety rule: a legitimate standard applies to domestic goods too.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
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