Our analysis of tariff imposition/liberalisation has been entirely qualitative so far. We have simply indicated the effects which may follow restriction/liberalisation without giving any indication of the likely order or magnitude of such changes. This is an important question. The net welfare effects of a given liberalisation process may be positive in magnitude but may only amount to the smallest fraction of GNP. If so, one may consider the lengthy and often complicated process of reducing trade barriers simply not worth the effort. If, on the other hand, the welfare effects are not only positive but relatively large (when expressed as a proportion of GNP) then trade policy may be expected to figure prominently in the policymakers’ ‘portfolio’.
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