INSTRUMENTS OF TRADE CONTROL
Governments use many rationales and seek a range of outcomes when they try to influence exports imports. The choice of trade-control instrument is crucial because each type may incite different responses from domestic and foreign groups. One way to understand trade- control instruments is by distinguishing between two types that differ in their effects:
- Those that indirectly affect the amount traded by directly influencing export or import prices
- Those that directly limit the amount of a good that can be traded Let's review these instruments.