Dr. Franz, This video as well as the large country example have helped me so much. Im currently in international economics and your videos have helped a lot. Sheridan and I sure do miss seing you around! Hope youre doing well.
Briana-- nice to hear from you! Sorry for the late reply; I broke a bone of my right hand. You and Sheridan remain one of my finest memories at UST. Without Sheridan I would not have thought about making these videos, so I have to thank her! I am glad to hear these videos help; that is the purpose of them. Best wishes to both of you.
Iris Franz .. I hope your hand gets better! Being injured is not fun. These videos are very helpful and helped me on my first international economics exam. I love seeing the new videos you post! Very helpful! Thank you!
So D is pretty much like putting someone in a lower indifference curve because of higher prices? And B would be lost profits to a more efficient producer? Like 2 bakeries next to each other. One spills ingredients everywhere and has higher cost, while the other is efficient. Before the tariff, the efficient producer had all the clients, but now after the tariff they split some of the clients?
for consumers, no matter to buy domestic product or importing goods, is the same price pw+t. It's indifferent to buy domestic product or importing product, then why this protect local producers ? Thank you
Without the tariff, domestic producers can only charge Pw to compete with imports. With tariff now the domestic producers can charge Pw+t. Put yourself in the shoes of the domestic producers- wouldn’t you be glad? Yes consumers are indifferent between similar imports and domestic products, like whirlpool and LG brand washing machines as long as functions and prices are similar.
Good question. Assuming that the government is not corrupt, like Western European countries the United States, the government uses the tax REVENUE to provide public goods such as public schools and highways (by which you receive your Amazon packages). Therefore I think it’s reasonable to call it revenue effect.
