Positive Feedback: The Impact of Trade Liberalization on Industry Demands for Protection

Oona A. Hathaway

International Organization, 1998, vol. 52, issue 3, 575-612

Abstract: Contrary to widely accepted theories of interest-group demand for protection, industries that experience high and rising import competition after a reduction in trade barriers often become less rather than more protectionist in the long term. To unravel this paradox, I propose and test a theory that explains variation in domestic producer groups' demand for protection over time. This model of industry behavior suggests that trade liberalization has a “positive feedback” effect on the policy preferences and political strategies of domestic industries, compelling them to adjust to more competitive market conditions and thereby reducing their future demand for protection.

Date: 1998
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