In this chapter, we turn from questions of unilateral reductions of protective barriers to the potentially more complex questions of multilateral reform. The literature on multilateral reform is extensive, ranging far beyond the scope of the present chapter. Here we shall reflect the emphasis in the theory and confine our attention to issues of tariff reform. In this respect, the theory has itself reflected the emphasis in the various rounds of GATT-sponsored trade negotiations, which have been notably more successful in securing tariff cuts than in removing (or, indeed, preventing the spread of) non-tariff barriers. Some reasons for this have already been offered in a political economy context in Chapter 8.

It is interesting to note that multilateral tariff reductions (MTRs) seem to have received considerably more attention in the literature than unilateral tariff reductions (UTRs). There are several reasons for this. In particular, while the simple idea of the gains from UTR can be succinctly stated in a model with one importable, the more interesting case of many goods and distortions was not thoroughly analysed until the 1970s when duality theory facilitated the developments surveyed in Section 9.1. On the other hand, problems of MTR (in particular the theory of customs unions) appeared less amenable to a unified framework. Indeed, such problems are inherently taxonomic, given the range of possible patterns of international trade and the sensitivity of results to the number of countries involved and the pattern of trade among them. For this reason, a voluminous literature developed examining various possible cases and issues (see Johnson, 1962; Kemp, 1969b; Lipsey, 1970; Meade, 1955b; Vanek, 1965; Viner, 1950).