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11 June, 07:54

What groups do you think might be most likely to support the tariff on wool and woolen items?

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  1. 11 June, 08:18
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    Farmers and national wool producers would support the establishment of tariffs on imports of textile products (and other protectionist policies).

    One of the effects of establishing a tariff on specific import products, is that national and external producers on that industry will not compete in equal terms anymore. In order to cross the border, imports need to pay a tariff. Therefore the market price of those imports will be forced to increase over the price they would have if there were no tariffs, and the potential of those firms to compete in prices with national producers is decreased.

    Protectionism is a manner of favouring national producers, that can be less efficient in the manufacturing process than the foreign producers but still be able to commercialize their products at a lower price and win in the price-competition dynamics. Therefore national producers will attract a higher share of consumers than if tariffs did not exist.
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