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Abstract
This paper examines several aspects of tariff rate quotas (TRQ) as adopted during tariffication of agricultural policies under
the Uruguay Round of GATT. Quota rents and non-tariff barrier effects may remain under TRQs, contrary to the objectives of
the tariffication process. Further, price stability impacts of a TRQ are more complex than those for either tariffs or quotas, and
under certain circumstances TRQs may be more stabilizing than either case, since TRQs truncate domestic production
distributions much like price bands policies. This complexity results from the possibility of regime switching, and may reflect
behavior under either a tariff, a quota, or a combination of cases. A TRQ policy may affect the timing of import decisions
based on incentives created under quota allocation procedures envisioned for this institution. It may also allow increased
imports as demand growth occurs because the quota is not necessarily a binding constraint. This means the above quota tariff
is the critical policy instrument. An empirical study of Philippines pork imports illustrates these issues. © 1998 Elsevier
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