In recent years the Israeli government has somewhat relaxed the previously severe restrictions on charter flights to Israel. This study suggests that liberalisation will benefit the balance of payments and the national economy, but that some restriction is desirable.
As in their article on Australian exports (in the May 1977 issue of this Journal), the authors find that the incidence of transport costs on exports from the United Kingdom to the United States is greater than that of tariffs. Savings in freight costs would stimulate international trade.
The author refutes the common belief that developing countries bear the burden of freight rates on both imports and exports. He concludes that a reduction in export rates would actually harm them, as it would lead to an increase in freight charged to importers, who cannot pass it on.
