9. Voluntary export restraints are preferable to tariffs. Voluntary export restraints give quota rights to foreign producers. When quota rights are efciently auctioned a quota has the same domestic welfare effect as an equivalent tariff in the shortmn and in the long run. Sweden's nancing the purchase of a new Boeing T4? trough the LLB. ExportImport Bank (known as the Esim Bank) at a favorable interest rate is an example of a US. export subsidy. Removal of nontariff barriers is more problematic to policymakers because they tend to be product and counuyspecic. A country should allow imports only from countries that agree to common international rules for trade. The Multifibre Arrangement (MFA) {controlling textiles and apparel imports] is a fair system and minimizes welfare loss by allocating quotas based on traditional market shares. According to the theory of the secondbest. tariffs represent the best way to counteract distortions in an economy. In industries with increasing returns to scale, tariffsI subsidies, or quotas may be effective ways of raising domestic welfare. It}. The most important NTB's used by developed countries against imports from developing 12. countries are dumping duties assessed against cheap foreign manufactured goods. Most tariffs around the world are collected on an ad valorem basis. US. trade law encourages the inclusion of costs incurred by importers {such as transportation and insurance charges) as part of imported goods prices