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This paper generalizes to higher dimensions the two good result that the optimal trade policy for a large country is an import tariff. A weak form of the optimal tariff, requiring that an import (export) good be most (least) protected holds under gross substitutability. Sufficient conditions are obtained for a strong form of the optimal tariff (which requires that all imports be more protected than any export) and also for the trade tax revenue to be nonnegative in the optimal policy.
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Eric W. Bond (1990) studied this question.
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