When Is It Optimal to Delegate: The Theory of Fast-Track Authority

Levent Celik, Bilgehan Karabay and John McLaren

American Economic Journal: Microeconomics, 2015, vol. 7, issue 3, 347-89

Abstract: With fast-track authority (FTA), the US Congress delegates trade policy authority to the president by committing not to amend a trade agreement. Why would it cede such power? We suggest an interpretation in which Congress uses FTA to forestall destructive competition between its members for protectionist rents. In our model: (i) FTA is never granted if an industry operates in the majority of districts; (ii) The more symmetric the industrial pattern, the more likely is FTA, since competition for protectionist rents is most punishing when bargaining power is symmetrically distributed; (iii) Widely disparate initial tariffs prevent free trade even with FTA. (JEL C78, D72, F13, F14)

JEL-codes: C78 D72 F13 F14 (search for similar items in EconPapers)
Date: 2015
Note: DOI: 10.1257/mic.20140031
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Citations: View citations in EconPapers (6)

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Working Paper: When is it Optimal to Delegate: The Theory of Fast-track Authority (2012)
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