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Damaging to the united states

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To protect American jobs, the US government may decide to cut US imports of bulldozers by 60%.  It could do so by either:

  • Imposing a tariff high enough to cut bulldozer imports by 60%
  • Persuading Komatsu and other foreign bulldozer makers to set up a voluntary export restraint arrangement to cut their exports of bulldozers to the US by 60%.

a. Which of these two policies would be less damaging to the United States? Please explain.

b. Which of these two policies would be less damaging to the world as a whole? Please explain.

Reference no: EM131274528

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