Welfare Effects of VERs Versus Quotas Versus Free Trade
Large Country Case

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Net Gains from Trade

Importing Country

Foreign Exporters

World as a Whole

With free trade

c+(b+d)+h

e+f+g

c+(b+d)+e+f+g+h

Import quota

c+e+h

g

c+e+g+h

With VER

h

c+e+g

c+e+g+h

VER vs. free trade

-c-(b+d)

c-f

-(b+d)-f

VER vs. quota

-c-e

c+e

zero