Properly designed tariffs or quotas can increase the real wages of workers in the domestic industry involved.

Question

Quizplus · Accepted Answer

Tariffs or quotas can limit the supply of imported goods, leading to an increase in demand for domestically produced goods. This can lead to an increase in the price of the domestically produced goods, which can result in higher profits for the domestic industry. Higher profits can then lead to higher wages for workers in that industry.

Properly Designed Tariffs or Quotas Can Increase the Real Wages