competition, governments have an arsenal of tools they can apply.
1. Import tariffsImport tariffs are taxes that have to be paid on imported products. Import tariffs are used to raise government revenue (in that case we speak of revenue tariffs) or to protect domestic firms against competition from foreign firms (in that case we speak of preotective tariffs).
Import tariffs are actually a way of making the price of foreign goods more expensive than they actually are. If the price becomes more expensive, the demand for the foreign products will go down.