Economic imperialism and resource nationalism: Comment on Kemp and Ohyama

Kemp and Ohyama show that a self-seeking resource-poor imperial economy can use tariffs to completely exploit its resource-rich raw-material producing colonial trading partner, but that when capital is immobile, the colonial economy loses all power to exploit by means of ad valorem trade taxes. We use geometry to explain why, and demonstrate that there are other instruments (export quotas, import quotas, an export tariff specified in units of the import per unit of the export, and destruction of the raw material by the colonial economy's government) which may restore the colonial economy's ability to exploit the imperial one.