On the Ocean of Protectionism The Structure of Swedish Tariffs and Trade 1780–1830

Sammanfattning: In the field of international trade there is an intriguing tension between the ideological allure of free trade and the political reality of protectionism. Typically, the former is favored by scholars while the latter has been more historically prevalent. Protectionism in the form of tariffs and other obstacles trade was generally a preferred trade policy around the globe in the 18th and early 19th centuries. Sweden was no exception and has been seen as highly protectionist and mercantilist during this period.This thesis has sought to shed new light on Swedish trade policy between 1780 and 1830. It has done so by quantifying and homogenizing tariffs and import bans in order to be able to analyze the structure of tariffs. The thesis stands on a theoretical ground which takes into account the different plausible reasons for setting tariffs. It has placed some emphasis on the possible tension between the desire to shelter one’s own industry from foreign competition and the need to use tariffs for fiscal purposes, as an important source of government revenue. It is therefore argued that tariffs need to be separated theoretically and empirically. A simple model is presented which aims to discern three types of tariffs. The model takes into account the tariff rate itself, and also the structure of trade and the presence of domestic substitution.The thesis has found that Swedish tariffs were generally high over the period and that protectionism was prevalent in a large number of economic sectors. There is tentative evidence that protectionist tariffs also distorted trade in certain types of goods, even if they didn’t have an impact on total import levels. Tariffs were also set so as to separate between raw materials and more processed goods, what is called mercantilist differentiation. Substantial empirical support is given to the claim that certain tariffs on inelastic consumption goods were of great fiscal importance, and increasingly so as the period progressed. The fiscal pressure maintained or even increased the import tariffs, which made it possible to decrease tariffs on exports.