Unprotective Tariffs, Ineffective Liberalization, And Other Mysteries: An Investigation of the Endogenous Dimensions of Trade Policy Formation in Australia‪.‬

1. Introduction Since its formation as a federation in 1901, Australia embraced a fairly comprehensive tariff schedule in relation to imported manufactures. (1) Tariff rates fluctuated considerably over the years. However, over the course of the century they remained sufficiently high to earn Australian manufacturing the reputation of one of the most heavily protected manufacturing sectors in the industrialized world. (2) In recent years, a number of liberalization waves have surfaced. The most notable of these took place in 1973, 1977, 1988, 1991, and, most recently, in 1994, with the signing of the "Uruguay round" of the GATT agreement. Still, tariffs remain a principal actor in Australia's menu of industrial policies. In a recent edition of the annual report of the Productivity Commission, (3) published in November 1999, it is noted that although tariffs have dropped considerably since 1994 "they remain an important form of assistance ... tariff assistance still accounts for around 90% of measured effective assistance to the manufacturing sector" (4) (p. 52).