Lobbying and Agricultural Trade Policy in the United States

Kishore Gawande
Authors registered in the RePEc Author Service: Bernard Hoekman

No 5634, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper studies whether political campaign contributions influence agricultural protection in the United States in the manner suggested by the political economy model of Grossman and Helpman (1994), using a detailed cross-sectional data set of agricultural protection, subsidies, and contributions to Political Action Committees in the late 1990s. The data do not reject the qualitative predictions of the model: that policymakers will consider both the wishes of specific lobbies and the interests of society as a whole in their decisions. However, the estimated weight of lobbying contributions in decision-making (actual policy) is found to be very low. This is a puzzle as it seems to suggest irrational behavior on the part of the lobbies that make political contributions. It is also inconsistent with the large estimates of deadweight losses from distortionary policy in agriculture. We show that the puzzle can be resolved by extending the model to allow uncertainty about the ability of politicians to deliver policy combined with the fact that contributions are made before policy is decided. The results of the analysis illustrate that the underpinnings of the prevailing political economy equilibrium that supports restrictive agricultural trade policies will be difficult to dislodge in the absence of mobilizing strong counter-lobbying to induce a more liberal policy stance. This of course is one rationale for international trade negotiations - but it requires that other groups in society see enough of an incentive to engage in the political process, pointing to the importance of the design of the negotiating agenda.

Keywords: agriculture; Lobbying; Political economy of protection (search for similar items in EconPapers)
JEL-codes: F13 (search for similar items in EconPapers)
Date: 2006-04
New Economics Papers: this item is included in nep-agr, nep-int and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (29)

Downloads: (external link)
https://cepr.org/publications/DP5634 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Journal Article: Lobbying and Agricultural Trade Policy in the United States (2006)
Working Paper: Lobbying and agricultural trade policy in the United States (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:5634

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP5634

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().