The term "quota" cannot be defined unambiguously. This term comes from the Latin word meaning a share or a part attributable to each. In this connection, a quota is a share of participation in a joint business (production or sale of goods, export or import) carried out by several manufacturers.
Instructions
Step 1
In a narrow sense, a quota is a quantitative limit of goods of a certain category that are allowed to be imported into a country from abroad or exported from it. The process of setting quotas is called quotas.
Step 2
Quotas are a measure of operational regulation of foreign economic relations of the state. By means of quotas, monetary and quantitative restrictions are established on the export and import of goods for a certain period. Quotas can be introduced in relation to certain goods, vehicles, works, services produced by one country or a group of countries.
Step 3
Quotas act as a non-tariff measure to regulate the country's external economy. It is designed to control supply and demand in the domestic market, and also serves as a response to discriminatory actions of foreign trading partners.
Step 4
The establishment of quotas has both positive and negative aspects. Producers and those employed in protected industries have significant gains in higher margins. Those enterprises that are under pressure from foreign competitors can demand from the state the introduction of quotas. But at the same time, domestic goods are becoming more expensive than under free trade, which leads to a narrower range of consumer choice.
Step 5
There are several types of quotas in the international regulation of trade:
- the global quota sets the total volume of imports of goods into the country for a certain period, regardless of their types and manufacturers;
- an import quota is a quantitative restriction on the import of certain goods into a country, established by the state in order to protect its own market;
- an individual quota limits the supply of a certain product to the country;
- the seasonal quota establishes a restriction on the import of agricultural products during the harvest period in the country;
- customs quota - a quota within which imported goods are subject to customs duties;
- export quota - a set volume of supplies for the export of certain goods.
