4.2
Types of trade protection
Tariffs, quotas, production and export subsidies and administrative barriers: the diagram for each, who gains and who loses, and at HL the calculation of every stakeholder effect.
Level and scope checked against the Economics guide (course first assessed 2022; October 2022 update), pp. 20–21, 46, on 11 Nov 2026. AI-assisted check, not reviewed by a teacher.
Contents
- 1Learning objectives and review status
- 2HL learning objectivesHL
- 3Trade protection and the model used to analyse it
- 4Tariffs: effects on the market and on stakeholders
- 5Import quotas: effects on the market and on stakeholders
- 6Production subsidies and export subsidies
- 7Administrative barriers: standards and regulations
- 8Comparing the instruments
- 9HL: calculating the effects of a tariff, a quota and a subsidy from a diagramHL
- 10Common mistakes and exam application
- 11Practice and feedback: 15 marks
- 12Practice and feedback: 15 marks
- 13Practice and feedback: 10 marks
- 14Practice and feedback: 2 marks
- 15Practice and feedback: 4 marks
- 16Practice and feedback: 4 marks
- 17Practice and feedback: 8 marksHL
- 18Practice and feedback: 4 marksHL
- 19Practice and feedback: 4 marksHL
- 20Paper 2 practice set: A tariff on steel in Sorala
- 21Sources and review status
1Learning objectives and review status
- Define tariff, import quota, production subsidy, export subsidy and administrative barrier.
- Draw a tariff diagram, a quota diagram and a subsidy diagram, and explain the effect of each measure on price, domestic production, domestic consumption, imports, expenditure, revenue and welfare.
- Explain how each measure affects domestic consumers, domestic producers, foreign producers, the government and society.
- Evaluate each measure against the alternatives for a stated aim.
2HL learning objectivesHL only
- Calculate from a diagram the effects of a tariff, a quota and a subsidy on each stakeholder.
3Trade protection and the model used to analyse it
is the use of government measures to limit imports or to support domestic producers and exporters against foreign competition. There are four main types: tariffs, quotas, subsidies (to production and to exports) and administrative barriers. Everything except a tariff is a .
Each instrument is analysed from the same starting point, the free-trade diagram for a good the country imports. Domestic demand is Dd and domestic supply is Sd. The good is available at the Pw, which is below the price at which Dd and Sd cross. Under the domestic price is Pw, domestic firms supply the quantity read from Sd at Pw, consumers buy the quantity read from Dd at Pw, and the gap between the two is imported.
The model assumes that the country is too small to affect the world price, so the world supply curve is a horizontal line at Pw. It also assumes that the foreign and the domestic good are identical, that the domestic market is competitive, and that other countries do not retaliate. The first assumption decides who pays for protection: because foreign producers can sell elsewhere at Pw, they go on receiving Pw whatever this country does, and the whole of any rise in the domestic price falls on domestic buyers.
For each instrument, follow the same eight effects and the same five groups, so that the instruments can be compared.
- Effects on the market: the domestic price, domestic production, domestic consumption and the quantity of imports.
- Effects on money flows: consumers' expenditure, domestic producers' revenue, foreign producers' revenue and the government's revenue or spending.
- Stakeholders: domestic consumers, domestic producers, foreign producers, the government, and society as a whole, measured by the change in welfare.
Key terms
- Trade protection
- Government measures that restrict imports or support exports to favour domestic producers.
- Non-tariff barrier
- Any measure other than a tariff that restricts imports, including quotas, subsidies to domestic producers and administrative barriers.
- Free trade
- International trade that takes place without government-imposed barriers such as tariffs, quotas or subsidies.
- World price
- The price at which a good is traded on international markets, which a small economy that trades freely has to accept.
4Tariffs: effects on the market and on stakeholders
A is a tax imposed on imported goods. A specific tariff is a fixed amount per unit; an ad valorem tariff is a percentage of the value of the import. The diagram uses a specific tariff of t per unit.
Importers must now pay Pw to the foreign producer and t to the government, so imports are available only at Pw+t. Domestic firms can raise their own price to the same level without losing sales, and the domestic price rises from Pw to Pw+t. At the higher price domestic firms extend along Sd, from Q1 to Q2, because units that cost more than Pw to produce are now profitable. Consumers contract along Dd, from Q4 to Q3. Imports fall at both ends, from Q4 − Q1 to Q3 − Q2.
- Domestic consumers lose. They pay Pw+t and buy Q3 in place of Q4. falls by the whole area between the two price lines out to Dd (L-G-J-K). Their expenditure changes from Pw × Q4 to (Pw+t) × Q3, which is a rise if demand is price inelastic over that range and a fall if it is price elastic.
- Domestic producers gain. Price and output both rise, so revenue rises from Pw × Q1 to (Pw+t) × Q2, rises by L-C-B-K and employment in the industry increases.
- Foreign producers lose sales, not price. They still receive Pw for each unit, but they sell Q3 − Q2 in place of Q4 − Q1. Their revenue falls from Pw × (Q4 − Q1) to Pw × (Q3 − Q2).
- The government gains revenue. is the tariff multiplied by the imports that remain, t × (Q3 − Q2), the rectangle C-G-H-F.
- Firms that use the good as an input lose. Their costs rise, so their own prices rise or their profits fall, and their exports become less competitive.
- Society loses the two triangles. Of the consumers' loss, L-C-B-K is transferred to producers and C-G-H-F to the government. The rest is a . Triangle B-C-F is a loss in production: the units from Q1 to Q2 are made at home at a cost above Pw, the price at which the world could supply them, so resources are drawn into a relatively inefficient industry. Triangle G-J-H is a loss in consumption: the units from Q3 to Q4, which buyers valued at more than Pw, are no longer bought.
Check your understanding
Check your understanding
Key terms
- Tariff
- A tax imposed on imported goods, which raises their price in the domestic market.
- Tariff revenue
- The government's income from a tariff: the tariff per unit multiplied by the quantity imported after the tariff is imposed.
- Consumer surplus
- The total amount consumers are willing to pay above the amount they actually pay, represented by the area below demand and above price.
- Producer surplus
- The total amount producers receive above the minimum amount they would have accepted, represented by the area above supply and below price.
- Welfare loss
- The loss of potential social surplus caused by an inefficient allocation relative to the social optimum.
5Import quotas: effects on the market and on stakeholders
An is a legal limit on the quantity, or sometimes the value, of a good that may be imported in a given period. It is usually enforced by issuing import licences: only a licence holder may bring the good in.
A quota matters only if it is smaller than the quantity imported under free trade. At the world price Pw there is then a shortage: consumers want Q4, but domestic firms supply Q1 and imports are limited to the quota. Buyers compete for the limited supply and the price rises. As it rises, domestic production extends along Sd and the quantity demanded contracts along Dd. The price settles at Pq, where the quantity demanded (Q3) equals domestic supply (Q2) plus the quota.
- Domestic consumers lose. They pay Pq and buy Q3 in place of Q4. Consumer surplus falls by L-G-J-K, exactly as under a tariff that raised the price to the same level. Expenditure changes from Pw × Q4 to Pq × Q3.
- Domestic producers gain. Revenue rises from Pw × Q1 to Pq × Q2, producer surplus rises by L-C-B-K and employment increases.
- The government receives no revenue, unless it sells or auctions the licences. It also bears the cost of administering and enforcing the quota.
- Licence holders earn the quota rent. Each permitted unit can be bought abroad at Pw and sold at home at Pq. The is (Pq − Pw) multiplied by the quota, the rectangle C-G-H-F.
- Foreign producers sell less. Whether they lose depends on the licences. If domestic importers hold them, foreign producers receive Pw on fewer units and their revenue falls. If the foreign exporters themselves hold the right to sell within the quota, they receive Pq on each unit and keep the rent, so they can earn more than before on a smaller quantity.
- Society loses the two triangles, and possibly more. B-C-F and G-J-H are the same production and consumption losses as under a tariff. If the rent goes to domestic importers or, through an auction, to the government, it stays in the country and the welfare loss is the two triangles. If it goes to foreign exporters, the country also loses the rectangle C-G-H-F.
| Tariff | Quota | |
|---|---|---|
| What the government fixes | The addition to the price; the quantity imported adjusts | The quantity imported; the price adjusts |
| Price, production, consumption | The same in both cases | The same in both cases |
| The rectangle C-G-H-F | Tariff revenue for the government | Quota rent for the licence holders |
| If domestic demand increases | Imports rise; the price stays at Pw+t | Imports cannot rise; the price rises further |
| Welfare loss to the country | The two triangles | The two triangles, plus the rent if it goes to foreign exporters |
Check your understanding
Key terms
- Import quota
- A legal limit on the quantity of a good that may be imported during a period, usually enforced through import licences.
- Quota rent
- The extra income earned by the holders of import licences under a quota: the gap between the domestic price and the world price multiplied by the quantity imported. Also called quota revenue.
- Trade protection
- Government measures that restrict imports or support exports to favour domestic producers.
6Production subsidies and export subsidies
A is a payment by the government to producers. Two different subsidies are used as trade protection, and they have different effects on the domestic price. A is paid on every unit that domestic firms produce, and helps them to compete with imports. An is paid only on units sold abroad, and helps firms to compete in foreign markets.
A production subsidy. The government pays domestic firms s for each unit they produce. Each unit now earns the firm the market price plus s, which has the same effect as a fall in costs of s per unit, so domestic supply shifts down by s, from Sd to Sd+subsidy. The price consumers pay does not change: imports are still freely available at Pw, so no domestic firm can charge more. At Pw domestic firms now supply Q2 in place of Q1. Consumption stays at Q3, so imports fall by exactly the rise in domestic production, from Q3 − Q1 to Q3 − Q2.
- Domestic consumers are unaffected in this market. The price is still Pw, the quantity bought is still Q3 and consumer surplus is unchanged. They may pay indirectly, as taxpayers.
- Domestic producers gain. They receive Pw+s for each unit and produce more. Revenue including the subsidy rises from Pw × Q1 to (Pw+s) × Q2, producer surplus rises by L-C-B-K and employment increases.
- The government pays. The subsidy costs s × Q2, the rectangle L-C-F-K, and brings in no revenue. The money has an opportunity cost: other spending forgone, higher taxes or more borrowing.
- Foreign producers lose sales. They still receive Pw, but imports fall, so their revenue falls from Pw × (Q3 − Q1) to Pw × (Q3 − Q2).
- Society loses one triangle. Part of the government's spending, L-C-B-K, is a transfer to producers. The rest, triangle B-C-F, is a welfare loss: the units from Q1 to Q2 are made at home at a cost above the world price. There is no loss in consumption, because the price consumers pay has not changed. For the same rise in domestic output, a production subsidy therefore costs society less than a tariff.
An export subsidy. Here the starting point is a good the country already exports, so the world price Pw is above the no-trade price. The government pays firms s for each unit they export. A firm now earns Pw+s on a unit sold abroad, so it will not sell at home for less. The domestic price rises to Pw+s, provided the exported goods cannot be bought back from abroad at Pw. Domestic consumption contracts, domestic production extends, and exports increase at both ends.
- Domestic consumers lose. They pay Pw+s in place of Pw and buy less; consumer surplus falls by L-B-C-K.
- Domestic producers gain. They receive Pw+s on every unit, sold at home or abroad, and produce more; producer surplus rises by L-H-G-K.
- The government pays s on every unit exported, the rectangle B-H-J-F.
- Society in the exporting country loses. The cost to consumers and to the government together is larger than the producers' gain by the two triangles B-C-F and G-H-J.
- Foreign producers lose; foreign consumers may gain. Producers in other countries lose sales to the subsidised exports. If the subsidising country is large enough for its extra exports to lower the world price, foreign consumers pay less and foreign producers, often farmers in developing countries, receive less. This is why an importing country may answer a subsidy with a tariff designed to offset it, called a countervailing duty.
Check your understanding
Key terms
- Subsidy
- A payment from the government to firms, usually per unit of output, which lowers their costs and shifts the supply curve vertically downward by the subsidy per unit.
- Production subsidy
- A payment by a government to domestic firms for each unit they produce, which lowers their costs so that they can compete with imports.
- Export subsidy
- A payment by a government to domestic firms for each unit they sell abroad, which lets them export at a lower price.
- Welfare loss
- The loss of potential social surplus caused by an inefficient allocation relative to the social optimum.
7Administrative barriers: standards and regulations
An is a rule or procedure that restricts imports by raising the cost, the time or the uncertainty of bringing a foreign good to market, without being a tax or a limit on quantity. These barriers are often called red tape.
- Product standards and technical regulations: safety, health, environmental and labelling requirements that every product sold in the country must meet, such as limits on pesticide residues, vehicle emission standards or rules on packaging and language.
- Animal and plant health rules: inspections, quarantine and bans intended to keep out pests and diseases.
- Customs procedures: paperwork, inspections, rules for valuing goods, a small number of permitted ports of entry and slow clearance.
- Licensing, testing and certification: a requirement to obtain an import licence, or to have a product tested again in the importing country although it has already been approved at home. The requirement in the European Union's 2026 steel regime to prove where steel was first melted and poured is an example of such documentary evidence.
The mechanism is a rise in the cost of supplying imports. Foreign firms have to redesign, test and certify their products, complete the paperwork and wait for clearance. Their cost per unit rises and deliveries become slower and less certain, so fewer imports are supplied at each price, or the price of imports rises. Domestic producers, who already meet the home standards, face less competition and can sell more, at a higher price. Consumers pay more and have less choice.
- Domestic consumers gain if the standard really protects their health or safety. They lose through higher prices and less choice if it is protection in disguise.
- Domestic producers gain a protected market.
- Foreign producers bear the cost of compliance. Much of it is a fixed cost, which a large exporter can spread over many units but a small one cannot, so small exporters and producers in developing countries are the most likely to be shut out.
- The government receives no revenue and pays for inspectors and customs staff. The barrier does not appear in the budget or in the tariff schedule, which makes it politically easy to use.
- Society loses the resources used up in compliance. Unlike tariff revenue or quota rent, this cost is not a transfer to anyone: it is real resources spent on forms, tests and waiting.
Check your understanding
Key terms
- Administrative barrier
- A rule or procedure, such as product standards, licensing or customs paperwork, that makes importing slower or more costly without being a tax or a quota.
- Non-tariff barrier
- Any measure other than a tariff that restricts imports, including quotas, subsidies to domestic producers and administrative barriers.
8Comparing the instruments
| Tariff | Quota | Production subsidy | Administrative barrier | |
|---|---|---|---|---|
| Domestic price | Rises to Pw+t | Rises to Pq | Unchanged at Pw | Rises |
| Domestic production | Rises | Rises | Rises | Rises |
| Domestic consumption | Falls | Falls | Unchanged | Falls |
| Imports | Fall | Fall to the quota | Fall | Fall |
| Government budget | Gains revenue | No revenue unless licences are sold | Pays the subsidy | Pays for administration |
| Welfare loss | Two triangles | Two triangles, plus the rent if it goes abroad | One triangle | The resources used in compliance, plus the losses from the higher price |
| Main loser at home | Consumers | Consumers | Taxpayers | Consumers |
| Certainty about import volume | Low | High | Low | Low |
| Visibility of the cost | High: a published tax | Medium | High: a line in the budget | Low |
9HL: calculating the effects of a tariff, a quota and a subsidy from a diagramHL only
When the diagrams carry numbers, every effect on every stakeholder can be calculated. The method is the same for the three instruments: read the price and the two quantities before the measure, read them again after it, then multiply a price by a quantity for each revenue or expenditure and use ½ × base × height for each welfare-loss triangle. The four worked examples use one invented steel market, the market of the free-trade calculation in the lesson on the benefits of international trade, so that the instruments can be compared.
- Tariff: prices and quantities. Price with the tariff = Pw + t. Imports before = Q4 − Q1; imports after = Q3 − Q2.
- Tariff: government. = t × (Q3 − Q2), the tariff multiplied by the imports that remain.
- Tariff: consumers and producers. Consumer expenditure changes from Pw × Q4 to (Pw + t) × Q3. Domestic producers' revenue changes from Pw × Q1 to (Pw + t) × Q2. Foreign producers' revenue changes from Pw × (Q4 − Q1) to Pw × (Q3 − Q2).
- Tariff: welfare. Welfare loss = ½ × t × (Q2 − Q1) + ½ × t × (Q4 − Q3). The fall in consumer surplus is t × Q3 + ½ × t × (Q4 − Q3); the rise in producer surplus is t × Q1 + ½ × t × (Q2 − Q1). As a check, the fall in consumer surplus equals the rise in producer surplus plus the tariff revenue plus the welfare loss.
- Quota: price and quantities. Imports equal the quota. The domestic price Pq is the price at which quantity demanded − quantity supplied = the quota, so the quota = Q3 − Q2.
- Quota: licence holders. = (Pq − Pw) × quota. Examination questions may call it quota revenue.
- Quota: consumers and producers. Consumer expenditure = Pq × Q3. Domestic producers' revenue = Pq × Q2. Foreign producers' revenue = Pw × quota if they do not receive the rent, and Pq × quota if they do.
- Quota: welfare. The two triangles are calculated as for a tariff, with (Pq − Pw) in place of t. If the rent goes to foreign exporters and the question asks for the loss to the importing country, add the rent.
- Production subsidy: prices and quantities. Consumers still pay Pw and buy Q3. Producers receive Pw + s, so domestic output Q2 is read from the original supply curve at Pw + s, or from the supply curve with the subsidy at Pw. Imports fall from Q3 − Q1 to Q3 − Q2.
- Production subsidy: government. Spending on the subsidy = s × Q2: the subsidy is paid on all domestic output, not only on the extra units.
- Production subsidy: producers and consumers. Domestic producers' revenue changes from Pw × Q1 to (Pw + s) × Q2. Foreign producers' revenue changes from Pw × (Q3 − Q1) to Pw × (Q3 − Q2). Consumer expenditure is unchanged at Pw × Q3.
- Production subsidy: welfare. Welfare loss = ½ × s × (Q2 − Q1). There is one triangle only.
- Export subsidy. The domestic price rises to Pw + s. Exports = quantity supplied − quantity demanded at that price. Spending on the subsidy = s × exports after the subsidy. The welfare loss is two triangles, each ½ × s × the change in quantity.
Check your understanding
Key terms
- Tariff revenue
- The government's income from a tariff: the tariff per unit multiplied by the quantity imported after the tariff is imposed.
- Quota rent
- The extra income earned by the holders of import licences under a quota: the gap between the domestic price and the world price multiplied by the quantity imported. Also called quota revenue.
- Production subsidy
- A payment by a government to domestic firms for each unit they produce, which lowers their costs so that they can compete with imports.
- Export subsidy
- A payment by a government to domestic firms for each unit they sell abroad, which lets them export at a lower price.
- Consumer surplus
- The total amount consumers are willing to pay above the amount they actually pay, represented by the area below demand and above price.
- Producer surplus
- The total amount producers receive above the minimum amount they would have accepted, represented by the area above supply and below price.
- Welfare loss
- The loss of potential social surplus caused by an inefficient allocation relative to the social optimum.
10Common mistakes and exam application
11Practice and feedback: 15 marks
12Practice and feedback: 15 marks
13Practice and feedback: 10 marks
14Practice and feedback: 2 marks
15Practice and feedback: 4 marks
16Practice and feedback: 4 marks
17Practice and feedback: 8 marksHL only
18Practice and feedback: 4 marksHL only
19Practice and feedback: 4 marksHL only
20Paper 2 practice set: A tariff on steel in Sorala
This set has 9 parts worth 40 marks in all, and the whole set should take about 100 minutes. Every part uses the texts and data below. Answer each part in its writing workspace before you open the feedback under it.
Text A: Steel towns under pressure
Paragraph 1: Steel has been made in the north of Sorala for a century. Over the last five years too much steel-making capacity around the world has pushed the world price of steel down to US$600 per tonne, and imports now supply 55% of the steel used in Sorala. Three steel plants have closed. Many of the workers who lost their jobs have skills that the region's growing service firms do not want, and structural unemployment in the north has risen sharply.
Paragraph 2: The low world price is not the only reason why imported steel has become cheaper. Large inflows of foreign direct investment (FDI) into Sorala's technology industry increased the demand for the Soralan peso, which appreciated against the US dollar in Year 2 (Table 2).
Text B: The government acts
Paragraph 1: At the start of Year 3 the government imposed a tariff of 25% on imported steel. Ministers argue that foreign producers are dumping steel in Sorala at prices below their costs, and that a steel industry is needed for national security. The steel producers' association expects output to rise by one million tonnes and employment in steel production to grow from 40,000 to 46,000 (Table 1). The average wage in the industry is 150,000 pesos a year.
Paragraph 2: Firms that use steel are less pleased. Car makers and construction firms, which together employ 320,000 workers, say that the tariff raises their costs and will make Soralan cars less competitive in export markets.
Text C: A threat of retaliation
Paragraph 1: The Eastern Union buys 30% of Sorala's exports of fruit and wine, which are worth 20 billion pesos a year in total. It has warned that it will place a tariff of 20% on these goods unless the steel tariff is withdrawn.
Paragraph 2: Some economists suggest a different approach. Instead of protecting steel, they say, the government should pay for retraining programmes for steelworkers who have lost their jobs and improve transport links between the north and the rest of the country.
| Item | Year 2 (no tariff) | Year 3 (estimate, with the tariff) |
|---|---|---|
| Price of steel in Sorala (pesos per tonne) | 2,400 | 3,000 |
| Domestic production (million tonnes) | 4.5 | 5.5 |
| Domestic consumption (million tonnes) | 10.0 | 9.0 |
| Imports (million tonnes) | 5.5 | 3.5 |
| Employment in steel production | 40,000 | 46,000 |
| Item | Year 1 | Year 2 |
|---|---|---|
| Exchange rate (US$ per peso) | 0.20 | 0.25 |
| Inflows of foreign direct investment (billion pesos) | 12 | 30 |
| Real GDP growth (%) | 3.5 | 3.0 |
| Unemployment rate, whole country (%) | 5.0 | 5.2 |
| Unemployment rate, northern region (%) | 9.0 | 13.5 |
| Current account balance (% of GDP) | −1.0 | −2.8 |
Define the term structural unemployment indicated in bold in the text (Text A, paragraph 1).
Open the writing workspace
Define the term tariff indicated in bold in the text (Text B, paragraph 1).
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Using information from Table 2, calculate the percentage change in the value of the Soralan peso against the US dollar between Year 1 and Year 2.
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The world price of steel was US$600 per tonne in both years. Using information from Table 2, calculate the change in the price, in pesos, of one tonne of imported steel between Year 1 and Year 2.
Open the writing workspace
Using an exchange rate diagram, explain how the inflows of foreign direct investment caused the Soralan peso to appreciate (Text A, paragraph 2).
Open the writing workspace
Using an international trade diagram, explain the effect of the tariff on domestic production of steel and on imports of steel in Sorala (Text B, paragraph 1 and Table 1).
Open the writing workspace
Using a demand and supply diagram, explain how the tariff on steel is likely to affect the market for cars made in Sorala (Text B, paragraph 2).
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Using an AD/AS diagram, explain how a tariff imposed by the Eastern Union on Sorala's exports could affect real GDP in Sorala (Text C, paragraph 1).
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Using information from the text/data and your knowledge of economics, discuss the view that Sorala's government should use a tariff to protect its steel industry.
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21Sources and review status
Written with AI assistance. The sources below were consulted on ; each entry says what it was used for and what it does not cover. Not reviewed by a teacher. Not approved as a finished revision resource.
Not yet checked against any source: the production subsidy for firms that compete with imports, and its diagram; the small-country version of the export subsidy diagram; administrative barriers beyond their definition.
Sources consulted
Diploma Programme Economics guide (course first assessed 2022; October 2022 update; cover reads "First assessment 2024")
International Baccalaureate. IB curriculum document, learner's own copy, 10 Nov 2026. Printed pp. 20-21 (syllabus outline) and the topic tables on the printed pages recorded on each syllabus node; assessment outline pp. 60-65; command terms pp. 74-75. PDF page = printed page + 6.
Used for: Topic titles, the scope of each topic and SL/HL level, the assessment format and the command terms, as recorded on each syllabus node.
Limits: Read from the learner's own PDF, which is not redistributed. The IB's online copy could not be opened by automated access (HTTP 403 on 11 November 2026), so this copy was not compared with it. It sets what must be taught; it does not explain the economics. AI-assisted reading, not checked by a teacher.
Principles of Microeconomics 3e: 20.1 Protectionism: An Indirect Subsidy from Consumers to Producers
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 20.1
Used for: Protectionism, tariffs, import quotas and nontariff barriers; a demand-and-supply analysis showing that trade barriers raise the domestic price, raise domestic output and reduce consumption; who gains and who pays.
Limits: Does not mention tariff revenue, quota rent, welfare-loss triangles or export subsidies. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
International Trade: Theory and Policy, 7.8 Import Tariffs: Small Country Welfare Effects
Saylor Academy (open textbook). Reference, read in full, 11 Nov 2026. Chapter 7, section 7.8, Table 7.3
Used for: A tariff in a small importing country: consumer surplus falls by A+B+C+D, producer surplus rises by A, government revenue rises by C, and national welfare falls by B+D, the production and consumption efficiency (deadweight) losses.
Limits: Open textbook published by Saylor Academy in 2012 under CC BY-NC-SA 3.0 with the author's name withheld at the author's request; undergraduate level.
Presidential Proclamation on Adjusting Imports of Steel into the United States (8 March 2018)
The White House (archived). Real-world source, read in full, 11 Nov 2026. Clauses 1–2 and the national-security finding
Used for: 25% steel tariff under Section 232, effective 23 March 2018; national-security finding; initial exemption of Canada and Mexico
Limits: Covers steel only (aluminium was a separate proclamation, not opened). Country exemptions changed repeatedly afterwards.
National Bureau of Economic Research. Real-world source, read in full, 11 Nov 2026. Abstract
Used for: Full incidence of the 2018 tariffs on domestic consumers; real-income loss of about $1.4 billion per month by end-2018
Limits: Abstract only; covers 2018 and short-run prices. A working paper (later published in the Journal of Economic Perspectives).
National Law Review (Polsinelli PC). Real-world source, read in full, 11 Nov 2026. Summary of USITC Publication 5405 findings
Used for: Secondary summary of USITC findings on import volumes, production and pass-through, 2018–2021
Limits: SECONDARY. The USITC site (usitc.gov, Publication 5405) returned HTTP 403 on 2026-11-11, so the primary report was not opened. Law-firm summary may be selective.
Active Presidential Tariff Actions in 2026: Fact Sheet (R49481, 8 October 2026)
Congressional Research Service. Real-world source, read in full, 11 Nov 2026. Introduction (p. 1) and Table 1 (current as of 30 September 2026)
Used for: Sequence after the Supreme Court ruling: Section 122 surcharge, its expiry on 24 July 2026, Section 301 tariffs on 60 economies, continuing Section 232 tariffs
Limits: Status as of 30 September 2026; later changes not checked. Table rows read from PDF text extraction, so only unambiguous rows are used.
International Trade: Theory and Policy, 7.14 Import Quota: Small Country Welfare Effects
Saylor Academy (open textbook). Reference, read in full, 11 Nov 2026. Chapter 7, section 7.14, Table 7.8
Used for: A quota in a small importing country: consumers lose A+B+C+D, producers gain A, quota rents are C, and national welfare falls by B+D if the rents stay at home. Who receives the rents depends on administration: the government if licences are auctioned, domestic holders if given away, foreigners if rights are given to foreign exporters.
Limits: Open textbook published by Saylor Academy in 2012 under CC BY-NC-SA 3.0 with the author's name withheld at the author's request; undergraduate level. The page's table caption says 'tariff' although it describes a quota.
New EU safeguards on steel imports from third countries
European Commission, Access2Markets. Real-world source, read in full, 11 Nov 2026. Whole notice and timeline table
Used for: Regulation (EU) 2026/1384: tariff-rate quota of 18.3 Mt/year, 50% out-of-quota duty, 30 product categories, melt-and-pour evidence, application from 1 July 2026
Limits: Country allocations and quarterly rules are in separate implementing acts that were not opened.
International Trade: Theory and Policy, 7.17 Export Subsidies: Large Country Welfare Effects
Saylor Academy (open textbook). Reference, read in full, 11 Nov 2026. Chapter 7, section 7.17
Used for: An export subsidy raises the domestic price in the exporting country: its consumers lose, its producers gain, the government pays the subsidy and national welfare falls; consumers in the importing country gain and its producers lose.
Limits: Open textbook published by Saylor Academy in 2012 under CC BY-NC-SA 3.0 with the author's name withheld at the author's request; undergraduate level. Large-country case with a terms-of-trade effect, which goes beyond the IB small-country diagram.
European Commission, Access2Markets. Real-world source, read in full, 11 Nov 2026. Whole notice
Used for: Implementing Regulation (EU) 2024/2754: company-specific definitive countervailing duty rates, applicable from 30 October 2024 for five years
Limits: Does not state the pre-existing 10% import duty or later price-undertaking decisions; the Commission press release page (ip_24_5589) could not be rendered.
Learning Resources, Inc. v. Trump, No. 24-1287 (slip opinion, decided 20 February 2026)
Supreme Court of the United States. Real-world source, read in full, 11 Nov 2026. Syllabus, pp. 1–2
Used for: Description of the 2025 IEEPA tariffs and the holding that IEEPA does not authorise tariffs
Limits: Only the syllabus was read (pp. 1–3). Says nothing on refunds or on tariffs under other statutes.
USTR Takes Action in Forced Labor Section 301 Investigations (press release, July 2026)
Office of the United States Trade Representative. Real-world source, read in full, 11 Nov 2026. Whole release
Used for: Section 301 action of 23 July 2026: tariff tiers (10% / 12.5%), list of 17 economies at 10%, exemption categories
Limits: Government press release; effective date and product annex are in the Federal Register notice, which was not opened (site redirected to a block page).
Global Trade Outlook and Statistics, March 2026 (news item, 19 March 2026)
World Trade Organization. Real-world source, read in full, 11 Nov 2026. News item text, headline figures
Used for: 2025 merchandise trade volume growth, 2026–27 forecasts, AI-related goods share, MFN share of world trade
Limits: 2025 figures are preliminary (data as of 10 March 2026) and subject to revision; forecasts exclude a prolonged energy shock scenario.
USDA Economic Research Service. Real-world source, read in full, 11 Nov 2026. Summary, 'What Did the Study Find?'
Used for: Export losses from retaliatory tariffs 2018–2019 by partner, commodity and state; US share of China's agricultural imports
Limits: Estimates of direct export losses only (not farm income net of government support payments); model-based.
Unemployment: Its Measurement and Types
Reserve Bank of Australia. Reference, read in full, 11 Nov 2026. Explainer: measurement; types of unemployment; other types
Used for: Definition of unemployment and the labour force; the unemployment rate as the share of the labour force that is unemployed; cyclical, structural and frictional unemployment, with seasonal unemployment listed separately; underemployment and hidden unemployment.
Limits: Australian survey definitions.
Principles of Macroeconomics 3e: 16.1 How the Foreign Exchange Market Works
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 16.1
Used for: The exchange rate as the price of one currency in terms of another; who demands and supplies a currency; appreciation and depreciation; who gains and loses from a stronger or weaker currency.
Limits: No currency-conversion calculation in the IB format. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
Principles of Microeconomics 3e: 3.2 Shifts in Demand and Supply for Goods and Services
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 3.2
Used for: Non-price determinants of demand (income for normal and inferior goods, tastes, population, prices of related goods, expectations) and of supply (input costs, natural conditions, technology, taxes, regulation and subsidies); the ceteris paribus assumption; a shift versus a movement along a curve. States that taxes shift supply left and subsidies shift it right.
Limits: No tax or subsidy diagram with incidence or welfare areas; no number-of-firms, joint or competitive supply. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 3.3
Used for: How a demand or supply shift changes equilibrium price and quantity, worked through a four-step method.
Limits: Does not use the words surplus or shortage; adjustment is described only in general terms. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
Principles of Macroeconomics 3e: 11.4 Shifts in Aggregate Demand
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 11.4
Used for: AD shifts from consumer and business confidence, government spending, taxes and monetary policy; imports are subtracted because they are not domestic demand.
Limits: Exports and exchange rates are mentioned only briefly. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 20.2
Used for: The cost to consumers of each job saved by protection; trade and wages; labour standards.
Limits: The cost-per-job figures are US estimates and should not be reused as current data. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.
Principles of Microeconomics 3e: 20.3 Arguments in Support of Restricting Imports
OpenStax, Rice University. Reference, read in full, 11 Nov 2026. Section 20.3
Used for: The infant industry argument; the anti-dumping argument, with dumping defined as selling below cost of production; environmental protection and the race to the bottom; unsafe consumer products; the national interest argument.
Limits: Does not cover balance-of-payments or government-revenue arguments. University-level US textbook: its wording, examples and diagrams are not IB wording and it is not an authority for IB scope or SL/HL level.