customers, which many low-income countries are.

12. The decision should not be arbitrary or unnecessarily discriminatory. It should treat foreign companies
566

the same way as domestic companies. It should be based on science.

13. Restricting imports today does not solve the problem. If anything, it makes it worse since it implies using

up domestic sources of the products faster than if they are imported. Also, the national security argument

can be used to support protection of nearly any product, not just things critical to our national security.

14. The effect of increasing standards may increase costs to the small exporting country. The supply curve of

toys will shift to the left. Exports will decrease and toy prices will rise. Tariffs also raise prices. So the effect

on the price of toys is the same. A tariff is a “second best” policy and also affects other sectors. However, a
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