Political Reform and Trade Policy

Raymond Riezman and John Douglas Wilson
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John Douglas Wilson: Department of Economics, Wylie Hall, Indiana University, Bloomington, IN 47405, USA

Chapter 13 in International Trade Agreements and Political Economy, 2013, pp 201-224 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractThe welfare effects of partial restrictions on political competition are investigated in a model in which two candidates receive campaign contributions from import-competing industries in return for tariff protection. Ceilings on allowable contributions per industry may be welfare-worsening, particularly if the "contributor elasticity" is high, because they induce candidates to seek additional contributors. Restrictions that reduce the number of industries allowed to contribute may also worsen welfare, because candidates respond by increasing contributions (and tariff protection) for each active contributor. The results suggest that the ability of candidates to circumvent partial restrictions may eliminate any potential benefits.

Keywords: International Trade; Political Economy; Theory of International Free Trade Agreements; Customs Unions; Tariff Dynamics; Storable Votes (search for similar items in EconPapers)
Date: 2013
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Related works:
Journal Article: Political reform and trade policy (1997)
Working Paper: Political Reform and Trade Policy (1993)
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