Japanese tariff on imported rice Research Paper Example | Topics and Well Written Essays - 500 words

Japanese tariff on imported rice - Research Paper Example These policies were modified sequentially thereafter until early 1980s when, as a result of pressure from Trading partners such as US made them open up rice borders. For instance, California rice producers in 1986 filed a petition to the government of United States under section 301 of the constitution that the policies of Japan were detrimental to the industry. During this time, Japan was imposing a subsidy of up to $2,200 per metric ton to domestic producers in Japan. As a result, the subsidies were about 10 times the World prices (Bergsten, Fred, Itō, & Noland, 2001). A tariff is a levied tax on the imports that raise effectively the cost of the goods imported in relation to the domestic products. Some specific tariffs are imposed as a charge that is fixed for very unit of imported good. In tariffs, there are entities that lose and those that gains. In more general terms, the state in most cases increases significantly since tariffs increases the revenue of the state. In addition, domestic producers gain since the tariff offers them protection against external competitors by cost increase of the foreign goods imported. As a result, consumer loses since they must pay extra for the imports. Thus, tariffs are anti-consumer and pro-producer, and they reduce the global efficiency of the economy (Bergsten, Fred, Itō, & Noland, 2001). As part of the policy introduced by the government, imports on rice have been banned by the government in Japan except the processed forms. In the same regard, disproportionate governing authority wielded by rice farmer’s production of rice has been subsidized. Trade friction between US and Japan has worsened. Tokyo logical basis on imposing such policies is to attain self-sufficiency in the production for food security reasons. In the same vein, farm groups domestically have maintained that cultivation of rice is part of their cultural diversity. Hayami (1988) argued that consumers of rice