A new empirical test of the infant-industry argument: the case of Switzerland protectionism during the 19th century

Léo Charles

Cahiers du GREThA (2007-2019) from Groupe de Recherche en Economie Théorique et Appliquée (GREThA)

Abstract: I employ the “granger causality” test to determine the nature of Swiss protectionism during the first wave of globalization (1886-1913). This test is applied for the first time to test if the protectionism takes the form of an infant-industry protection. I argue that if tariffs cause exports flow, the economy implement a protection following List’s principles. I use a highly disaggregated database of exports flow and tariffs at the product level. It allows dealing with a panel-VAR structure to test my hypothesis. In the descriptive study I show that Switzerland protectionism is moderate and selective, giving argument in favour of an infant industry protection. Then, the result of the “granger causality” test clearly shows that my different measures of protection “granger cause” exports flows. This article gives a new empirical test of the infant industry protection argument.

Keywords: International trade; Protectionism; First Globalization (search for similar items in EconPapers)
JEL-codes: F13 N13 N73 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-his and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:grt:wpegrt:2017-11

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