Ep. 384 Explaining Optimal Tariff Theory and Its Relation to Standard Free Trade Arguments

Bob Murphy Show

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Bob first explains the neoclassical theory of "optimal tariffs," by which a large country can use a modest tariff to improve its terms of trade. He then shows how this theoretical possibility is consistent with standard arguments making the case for free trade.

Mentioned in the Episode and Other Links of Interest:

The link for Monetary-Metals.com.
Fed Reserve Bank of Richmond piece on optimal tariff theory.
Bob and Josh Hendrickson discuss Stephen Miran's strategy for using tariffs to help the US position.
Bastiat's "Petition of the Candlemakers."
Bob on the Human Action podcast clarifies comparative advantage.
Bob interviews Brian Domitrovic on economists having a biased view of tariffs vs. income taxes.
Help support the Bob Murphy Show.