The Structure of Tariffs and Long-Term Growth

Nathan Nunn and Daniel Trefler

American Economic Journal: Macroeconomics, 2010, vol. 2, issue 4, 158-94

Abstract: We show that the "skill bias" of a country's tariff structure is positively correlated with long-term per capita GDP growth. Testing for causal mechanisms, we find evidence consistent with the existence of real benefits from tariffs focused in skill-intensive industries. However, this only accounts for a quarter of the total correlation between skill-biased tariffs and growth. Turning to alternative explanations, we extend the standard Grossman-Helpman "protection-for- sale" model and show how the skill bias of tariffs can reflect the extent of domestic rent-seeking activities in the economy. We provide evidence that the remaining variation is explained by this endogeneity. (JEL D72, F13, F43, O17, O19, O24, O47)

JEL-codes: D72 F13 F43 O17 O19 O24 O47 (search for similar items in EconPapers)
Date: 2010
Note: DOI: 10.1257/mac.2.4.158
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Citations: View citations in EconPapers (34)

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Working Paper: The Structure of Tariffs and Long-Term Growth (2010)
Working Paper: The Structure of Tariffs and Long-Term Growth (2010)
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