NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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The Lerner Symmetry Theorem: Generalizations and Qualifications

Arnaud Costinot, Iván Werning

NBER Working Paper No. 23427
Issued in May 2017
NBER Program(s):The International Trade and Investment Program

The Lerner Symmetry Theorem (Lerner, 1936) establishes the equivalence between import tariffs and export taxes in a simple neoclassical economy with two countries, two final goods, and no trade costs. In this paper we provide a number of generalizations and qualifications of this well-known result. Among other things, we show that the absence of trade deficits is neither necessary nor sufficient for Lerner Symmetry to hold. We conclude by discussing its implications for border tax adjustments.

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Document Object Identifier (DOI): 10.3386/w23427

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