1. Lobbying, Counterlobbying, and the Structure of Tariff Protection in Poor and Rich Countries
- Author
-
Marcelo Olarreaga, Jaime de Melo, and Olivier Cadot
- Subjects
FOREIGN TRADE ,TRADE LIBERALIZATION ,SOCIAL WELFARE ,TAX ,GENERAL EQUILIBRIUM ,DEVELOPING COUNTRY ,VALUE ADDED ,GROSS DOMESTIC PRODUCT ,WORLD TRADE ,Gross domestic product ,ELASTICITY OF SUBSTITUTION ,DOMESTIC PRICE ,TERMS OF TRADE ,ELASTICITY OF SUPPLY ,Economics ,Open economy ,MARKET ENTRY ,Free trade ,EQUATIONS ,PRICE ELASTICITY OF SUPPLY ,Stylized fact ,BENEFICIARIES ,INCOME ,NEW POLITICAL ECONOMY ,INDUSTRIAL COUNTRY ,POLITICAL POWER ,TARIFF RATE ,WORLD DEVELOPMENT INDICATORS ,RETURNS ,GOVERNMENT GRANTS ,DUTY DRAWBACKS ,PRICE ELASTICITY OF DEMAND ,TRADE POLICY ,WORLD TRADE ORGANIZATION ,CONSTANT RETURNS TO SCALE ,BENEFICIARY ,CLAIMANTS ,Tariff ,INCOMES ,Development ,DEMOCRACY ,DEVELOPMENT ECONOMICS ,LOW-INCOME COUNTRIES ,GENERAL EQUILIBRIUM ANALYSIS ,BID ,ECONOMICS RESEARCH ,WAGES ,EQUILIBRIUM TARIFF ,OPEN ECONOMY ,IMPORT PROTECTION ,OPTIMIZATION ,LABOR MARKET ,SAFETY NET ,ELASTICITY ,INDUSTRIALIZATION ,International economics ,GDP PER CAPITA ,INCOME LEVELS ,TARIFF STRUCTURE ,FOREIGN TRADE POLICY ,EQUILIBRIUM ,TRADE PROTECTION ,CAPITAL OWNERS ,PROTECTIONIST ,PROTECTIONISM ,ECONOMIC DEVELOPMENT ,RETURN ,WEALTH ,AGRICULTURE ,EQUILIBRIUM VALUE ,PRICE CHANGE ,DEVELOPED COUNTRIES ,CONSUMERS ,PRICE ELASTICITY ,DEVELOPING ECONOMIES ,WTO ,GDP ,UTILITY FUNCTION ,REPUBLIC ,LOBBYING ,TRADE REFORM ,POLITICAL ECONOMY ,PUBLIC FUNDS ,POLITICAL SYSTEM ,INCOME DISTRIBUTION ,TAXATION ,INTERNATIONAL ECONOMICS ,POLITICAL ECONOMY OF TRADE ,Commercial policy ,EXPORTS ,INTERNATIONAL TRADE STATISTICS ,DERIVATIVES ,GENERAL EQUILIBRIUM MODEL ,INTERNATIONAL TRADE ,CONSUMER SURPLUS ,CD ,OUTPUT ,PRODUCTION STRUCTURES ,Economics and Econometrics ,LDCS ,URUGUAY ROUND ,World Development Indicators ,TARIFF REVENUE ,EXPENDITURES ,POLITICAL ECONOMY OF TRADE POLICY ,IMPORTS ,IMPORT COMPETITION ,DEVELOPING COUNTRIES ,ECONOMIC STRUCTURE ,INTERNATIONAL BANK ,Accounting ,TARIFF NEGOTIATIONS ,POSITIVE TARIFFS ,TARIFF PROTECTION ,LABOR MARKETS ,INDUSTRIAL COUNTRIES ,DERIVATIVE ,IMPERFECT COMPETITION ,TRADE TAXES ,TARIFF ESCALATION ,Protectionism ,PRODUCTION FUNCTION ,TARIFF FORMATION ,CAMPAIGN CONTRIBUTIONS ,DOMESTIC PRICES ,CETERIS PARIBUS ,TARIFF RATES ,Finance ,EXPENDITURE ,EXPORT TAXES ,MARGINAL UTILITY ,SOCIAL SAFETY NET - Abstract
A political economy model of protection is used to determine endogenously the intersectoral patterns of protection. Three propositions are derived that are consistent with the stylized patterns of tariff protection in rich and poor countries: Nominal protection rates escalate with the degree of processing, protection is higher on average in poor countries, and rich countries protect agriculture relatively more than they protect manufacturing, whereas poor countries do the reverse. Numerical simulations for archetypal rich and poor economies confirm that the endogenously determined structure of protection is broadly consistent with observed patterns of protection.
- Published
- 2004