Quota Rents

Quota Rents

Quota Rents and International Trade Economy

In relation to international trade economy, Christopher Mark (1993) provided the following definition of Quota Rents: The increase in profits that accrue to an import dealer (under an import quota) or an exporting firm (under an export quota or voluntary restraint agreement –see Sec. I). Quota rents result from the effect of a quota in raising prices in the importing country above the competitive equilibrium level as market supply is reduced. Under a tariff, in contrast, the government of the importing country derives economic benefits from the trade restriction.


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