Final answer:
Import quotas are designed to protect domestic producers by limiting foreign competition, which allows these producers to potentially earn more, not less. Thus, domestic producers are not harmed by such quotas; instead, it's the domestic consumers who may face higher prices.
Step-by-step explanation:
Import quotas tend to lead to a variety of effects on the economy of a country, particularly in the areas of domestic production, pricing, and consumption. However, when considering the impacts mentioned in the question, it is important to identify which one does not occur as a result of imposing import quotas.
Among the provided choices:
- Domestic producers of the imported good being harmed
- Domestic consumers of the imported good being harmed
- Prices increasing in the importing country
- Prices falling in the exporting country
The one that import quotas do not lead to is domestic producers of the imported good being harmed. In contrast, quotas typically protect domestic producers from foreign competition, allowing them to charge higher prices and possibly increasing their revenues. On the other hand, domestic consumers may have to pay more for goods due to reduced foreign competition and higher prices. Furthermore, while prices would likely increase in the importing country due to these restrictions, the prices in the exporting country could either remain unchanged or decrease if the reduced demand leads to an oversupply.