A dynamic model of endogenous trade policy

Beverly Lapham and Roger Ware ()

Canadian Journal of Economics, 2001, vol. 34, issue 1, 225-239

Abstract: Empirical evidence suggests that past levels of protection are significant determinants of current levels of protection. We investigate dynamic interactions among interest groups and resulting endogenous links between current and future trade policies. We explore these intertemporal links in a small open economy in which lobbying and tariff policies are the outcome of a dynamic game among factor owners. The model can generate cycles with prolonged periods of free trade and/or prolonged periods of restricted trade (i.e., persistent trade policies). An interesting aspect of the environment is the role of lobbying as a partial substitute for intertemporal trade.

JEL-codes: C73 F13 (search for similar items in EconPapers)
Date: 2001
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Working Paper: A Dynamic Model of Endogenous Trade Policy (1993)
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