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Domestic purchase requirements for import license allocations in Mali, Volume 1
 
Author:Takacs, Wendy E.; Collection Title:Policy, Research, and External Affairs working papers ; no. WPS 569. Trade policy
Country:Mali; Date Stored:2001/04/26
Document Date:1991/01/31Document Type:Policy Research Working Paper
SubTopics:Environmental Economics & Policies; Markets and Market Access; Economic Theory & Research; Free Trade; Access to MarketsLanguage:English
Major Sector:(Historic)Economic PolicyRegion:Africa
Report Number:WPS569Sub Sectors:Trade
Volume No:1  

Summary: This paper investigates the incentive system facing importers under a linking arrangement and their likely behavior. It analyzes the impact on imports, consumption, and domestic production and the social costs under the assumption that all the relevant "industries" (production of the product in the domestic market, importing and distribution) are competitive, in the sense that there are a large number of firms involved and nothing deters new firms from entering the market. It focuses on the interaction of the linking arrangement with price controls, because the products in question also have been subject to this additional regulation. The overlapping regulations pose problems of timing in the liberalization process. The paper also investigates the operation of the linking arrangements when domestic production is monopolized. The conclusion is that the ranking of the policy instruments as a means of obtaining certain objectives may switch if the domestic industry is not competitive.

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