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Do contributions levels matter for endogenous protection or is the existence of a lobby sufficient? Are lobbies' net benefits from protection identical to their contribution levels, or does the level of protection simply reflect contribution levels of supporters and opponents? We estimate the Influence Driven (Grossman and Helpman, 1994) and the Tariff(More)
This paper empirically examines the alternative posed by Richardson [J. Intern. Econ. 34 (1993) 39] to the traditional view that trade integration may exacerbate inefficiencies. Richardson's hypothesis boldly predicts that trade diversion (and trade creation) may actually cause tariffs to decline! The hypothesis is fundamentally attributable to the presence(More)
Regional agreements on standards have been largely ignored by economists and blessed by multilateral trade rules. Using a constructed panel data that identifies the different types of agreements at the industry level, we find that such agreements increase the trade between participating countries but not necessarily with the rest of the world. Harmonization(More)
We provide new survey evidence showing that loss aversion and reference dependence are important in shaping people's preferences over trade policy. Under the assumption that agents' welfare functions exhibit these behavioral elements, we analyze a model with a welfare-maximizing government and with the lobbying framework of Grossman and Helpman (1994). The(More)
Policy making power enables governments to redistribute income to powerful interests in society. However, some governments exhibit greater concern for aggregate welfare than others. This government behavior may itself be endogenously determined by a number of economic, political and institutional factors. Trade policy, being fundamentally redistributive,(More)
Government exchange rate regime choice is constrained by both political and economic factors. One political factor is the role of special interests: the larger the tradable sectors exposed to international competition, the less likely is the maintenance of a fixed exchange rate regime. Another political factor is electoral: as an election approaches, the(More)
In the recent special issue of Ecological Economics devoted to the environmental Kuznets curve (EKC) hypothesis, Rothman speculates that: ‘‘what appear to be improvements in environmental quality may in reality be indicators of increased ability of consumers in wealthy nations to distance themselves from the environmental degradation associated with their(More)