PER-UNIT DUTIES: FRIENDS OR FOES OF DEVELOPING COUNTRY EXPORTERS?
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Protectionist instruments such as tariffs can distort the prices of traded
goods. This paper explores the impact of specific (per-unit) duties on patterns of
agricultural trade. Specific duties may encourage countries to export higher
priced products, leading to an “Alchian-Allen effect” on unit values. Their
restrictive effect on trade values is smaller for developed compared to
developing countries. It can be explained by the specialization of these countries
on low-priced products and by the low level of quality differentiation among
their exports. Our results highlight the discriminating nature of specific duties
for low-income countries.