Quota rent意思

"Quota rent" is a term used in economics and international trade, specifically in the context of tariffs and import quotas. It refers to the excess of the revenue collected from imports over and above the revenue that would have been collected if imports had been subject to a tariff equal to the average rate of duty applied to imports during the quota period.

In other words, quota rent is the additional revenue that a country collects by imposing an import quota rather than a simple tariff. An import quota is a limit on the quantity of a good that can be imported into a country during a specific period of time. When a quota is imposed, the supply of the good is restricted, which can lead to higher prices in the importing country. Higher prices mean that the government collects more revenue from the higher duties paid on the imported goods.

The quota rent is the difference between the total revenue collected from the higher prices due to the quota and the total revenue that would have been collected if the same quantity of goods had been imported and a simple tariff had been applied instead of the quota.

For example, if a country imposes a quota on a certain good and collects $10 million in duties, but if the same quantity of goods had been imported and a simple tariff of 10% had been applied, the government would have collected $8 million in duties, the quota rent would be $2 million ($10 million - $8 million).

Quota rents can be a source of revenue for the importing country, but they can also lead to higher prices for consumers and may be used as a protectionist measure to shield domestic producers from foreign competition.