Costly Revenue-Raising and the Case for Favoring Import-Competing Industries

Xenia Matschke

No 1502, CESifo Working Paper Series from CESifo

Abstract: A standard finding in the political economy of trade policy literature is that we should expect export-oriented industries to attract more assistance than import-competing industries. In reality, however, trade policy is heavily biased toward supporting import industries. This paper shows within a standard protection for sale framework, how the costliness of raising revenue via taxation may make export subsidies less desirable and import tariffs more desirable. The model is then estimated and its predictions are tested using U.S. tariff data. An empirical estimate of the costliness of revenue-raising is also obtained.

Keywords: protection for sale; tariffs; trade protection (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-int, nep-pol and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Costly revenue-raising and the case for favoring import-competing industries (2008)
Working Paper: Costly Revenue-Raising and the Case for Favoring Import-Competing Industries (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1502

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