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What are voluntary export restraint (VER) agreements? Why do

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What are voluntary export restraint (VER) agreements? Why do some governments force foreign exporters into them instead of just using quotas or tariffs to restrict imports by the same amounts? Is it because VERs bring the importing country a bigger national gain than quotas or tariffs?

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A voluntary export restraint agreement is a quota for export that is set by the country doing the exporting, and is just as frequently called a voluntary restraint agreement (VRA). In a VER, the country that is importing the goods requires that the country exporting the goods to that country limit their exports. If the United States was exporting to China, and there was a VER between China and the U.S., China would request that we limit our exports into China. This would cause the U.S. to act as a cartel, and to raise prices on the goods that ...

Solution Summary

What are voluntary export restraint (VER) agreements? Why do some governments force foreign exporters into them instead of just using quotas or tariffs to restrict imports by the same amounts? Is it because VERs bring the importing country a bigger national gain than quotas or tariffs?

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