Lobbying Competition Over Trade Policy / Kishore Gawande, Pravin Krishna, Marcelo Olarreaga.

Format:

Book

Author/Creator:

Gawande, Kishore.

Contributor:

National Bureau of Economic Research.

Krishna, Pravin.

Olarreaga, Marcelo.

Series:

Working Paper Series (National Bureau of Economic Research) no. w11371.

NBER working paper series no. w11371

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2005.

Summary:

Competition between opposing lobbies is an important factor in the endogenous determination of trade policy. This paper investigates empirically the consequences of lobbying competition between upstream and downstream producers for trade policy. The theoretical structure underlying the empirical analysis is the well-known Grossman-Helpman model of trade policy determination, modified suitably to account for the cross-sectoral use of inputs in production (itself a quantitatively significant phenomenon with around 50 percent of manufacturing output being used by other sectors rather than in final consumption). Data from more than 40 countries are used in our analysis. Our empirical results validate the predictions of the theoretical model with lobbying competition. Importantly, accounting for lobbying competition also alters substantially estimates of the"welfare-mindedness" of governments in setting trade policy.

Notes:

Print version record

May 2005.