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Fig. 9-2. The effect of tariffs in a small economy on the domestic market (L) and the import market (R).tex
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Fig. 9-2. The effect of tariffs in a small economy on the domestic market (L) and the import market (R).tex
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\documentclass[12pt]{article}
\linespread{1.25}
\usepackage{times}
\usepackage{pgfplots}
\pgfplotsset{compat = newest}
\usetikzlibrary{positioning, arrows.meta}
\usepgfplotslibrary{fillbetween}
\usepackage{amsmath}
\begin{document}
\begin{center}
\hspace*{-4cm}\begin{tikzpicture}
% Domestic market
\begin{axis}[
scale = 0.8,
xmin = 0, xmax = 10,
ymin = 0, ymax = 10,
axis lines* = left,
xtick = {0}, ytick = \empty,
axis on top,
clip = false,
]
% Colouring areas
\fill[violet, opacity = 0.1] (0, 2) -- (1.63, 2) -- (3.5, 5) -- (0, 5);
\fill[orange, opacity = 0.1] (1.63, 2) -- (3.5, 2) -- (3.5, 5);
\fill[orange, opacity = 0.1] (6, 2) -- (8.25, 2) -- (6, 5);
\fill[green, opacity = 0.1] (3.5, 2) -- (6, 2) -- (6, 5) -- (3.5, 5);
% Supply and demand curves
\addplot[color = red, very thick] coordinates{(1, 1) (6, 9)};
\addplot[color = blue, very thick] coordinates {(3, 9) (9, 1)};
% Dashed lines
\addplot[color = black, dashed, thick] coordinates {(0, 2) (13.4, 2)};
\addplot[color = black, dashed, thick] coordinates {(0, 5) (13.4, 5)};
\addplot[color = black, dashed, thick] coordinates {(1.63, 0) (1.63, 2)};
\addplot[color = black, dashed, thick] coordinates {(3.5, 0) (3.5, 5)};
\addplot[color = black, dashed, thick] coordinates {(6, 0) (6, 5)};
\addplot[color = black, dashed, thick] coordinates {(8.25, 0) (8.25, 2)};
% Coordinate points
\addplot[color=black, mark=*, only marks, mark size=3pt] coordinates {(4.64, 6.82)};
% Labels
\node [above] at (current axis.above origin) {Price, $P$};
\node [right] at (current axis.right of origin) {Quantity, $Q$};
\node [right] at (6, 9) {$S$};
\node [right] at (9, 1) {$D$};
\node [below] at (1.63, 0) {$Q_S$};
\node [below] at (3.5, 0) {$Q_S^\prime$};
\node [below] at (6, 0) {$Q_D^\prime$};
\node [below] at (8.25, 0) {$Q_D$};
\node [left] at (0, 2) {$P_W$};
\node [left] at (0, 5) {$P_T$};
\node at (1.5, 3) {$A$};
\node at (3, 3) {$B$};
\node [left] at (5.1, 3) {$C$};
\node at (6.5, 3) {$F$};
% Dimension lines
\draw[|-|] (3.5, -1.4) to (6, -1.4);
\node [below] at (4.94, -1.4) {$Q^\prime$};
\draw[|-|] (1.63, -2.7) to (8.25, -2.7);
\node [below] at (4.94, -2.7) {$Q_E$};
\draw[|-|] (-1.6, 2) to (-1.6, 5);
\node [left] at (-1.6, 3.5) {Tariff};
\end{axis}
% Import market
\begin{axis}[
scale = 0.8,
xmin = 0, xmax = 10,
ymin = 0, ymax = 10,
axis lines* = left,
xtick = {0}, ytick = \empty,
axis on top,
clip = false,
shift = {(axis cs: 15, 0)},
]
% Colouring areas
\fill[green, opacity = 0.1] (0, 2) -- (3.67, 2) -- (3.67, 5) -- (0, 5);
\fill[orange, opacity = 0.1] (3.67, 2) -- (3.67, 5) -- (7.67, 2);
% Supply and demand curves
\addplot[color = red, very thick] coordinates{(0, 2) (9, 2)};
\addplot[color = red, opacity = 0.3, very thick] coordinates{(0, 5) (9, 5)};
\addplot[color = blue, very thick] coordinates {(1, 7) (9, 1)};
% Dashed lines
\addplot[color = black, dashed, thick] coordinates {(3.67, 0) (3.67, 5)};
\addplot[color = black, dashed, thick] coordinates {(7.67, 0) (7.67, 2)};
% Coordinate points
\addplot[color=black, mark=*, only marks, mark size=3pt] coordinates {(3.67, 5) (7.67, 2)};
% Labels
\node [above] at (current axis.above origin) {Price, $P$};
\node [right] at (current axis.right of origin) {Imports, $Q$};
\node [right] at (9, 2) {$S$};
\node [right] at (9, 5) {$S^\prime$};
\node [right] at (9, 0.8) {$D$};
\node [below] at (3.67, 0) {$Q^\prime$};
\node [below] at (7.67, 0) {$Q_E$};
\node [left] at (0, 2) {$P_W$};
\node [left] at (0, 5) {$P_T$};
\node [above] at (2, 2) {$C$};
\node [above] at (5, 2) {$B + F$};
% Legend
\node[above left, draw, align = left] at (10, 12) {
\fcolorbox{black}{violet!10}{\makebox[\fontcharht\font`X]{$A$}} : Producer surplus gain and consumer surplus loss \\
\fcolorbox{black}{orange!10}{\makebox[\fontcharht\font`X]{$B$}} + \fcolorbox{black}{orange!10}{\makebox[\fontcharht\font`X]{$F$}} : Deadweight loss \\
\fcolorbox{black}{green!10}{\makebox[\fontcharht\font`X]{$C$}} : Tariff revenue
};
\end{axis}
\end{tikzpicture}\hspace*{-4cm}
\end{center}
\textbf{Figure 9-2:} The effect of tariffs in a small economy on the domestic market (L) and the import market (R).
\end{document}