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Fast-Track Authority and International Trade Negotiations

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Author Info

  • Paola Conconi
  • Giovanni Facchini
  • Maurizio Zanardi

Abstract

We develop a simple model of trade relations in which legislators with different stakes in import-competing and export industries decide whether to grant fast-track authority (FTA) to the president, giving up the power to amend international trade agreements. We show that strategic delegation motives are key to understanding FTA votes, which involve a decision between alternative country representatives: the executive or the majority in Congress. We then examine the determinants of all votes by US congressmen on FTA since the introduction of this institutional procedure in 1974. Our empirical analysis provides strong support for the predictions of the model. (JEL D72, F12, F13)

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Journal: Economic Policy.

Volume (Year): 4 (2012)
Issue (Month): 3 (August)
Pages: 146-89

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Handle: RePEc:aea:aejpol:v:4:y:2012:i:3:p:146-89

Note: DOI: 10.1257/pol.4.3.146
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References

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  1. Douglas A. Irwin, 1998. "From Smoot-Hawley to Reciprocal Trade Agreements: Changing the Course of U.S. Trade Policy in the 1930s," NBER Chapters, in: The Defining Moment: The Great Depression and the American Economy in the Twentieth Century, pages 325-352 National Bureau of Economic Research, Inc.
  2. Robert C. Feenstra, 1996. "U.S. Imports, 1972-1994: Data and Concordances," NBER Working Papers 5515, National Bureau of Economic Research, Inc.
  3. Grossman, Gene & Helpman, Elhanan, 1993. "Trade Wars and Trade Talks," CEPR Discussion Papers 806, C.E.P.R. Discussion Papers.
  4. Lohmann, Susanne & O'Halloran, Sharyn, 1994. "Divided government and U.S. trade policy: theory and evidence," International Organization, Cambridge University Press, vol. 48(04), pages 595-632, September.
  5. Christian Broda & Nuno Limão & David Weinstein, 2006. "Optimal Tariffs: The Evidence," NBER Working Papers 12033, National Bureau of Economic Research, Inc.
  6. Mayer, Wolfgang, 1981. "Theoretical Considerations on Negotiated Tariff Adjustments," Oxford Economic Papers, Oxford University Press, vol. 33(1), pages 135-53, March.
  7. Segendorff, Bjorn, 1998. "Delegation and Threat in Bargaining," Games and Economic Behavior, Elsevier, vol. 23(2), pages 266-283, May.
  8. Glaeser, Edward L. & Ward, Bryce A., 2006. "Myths and Realities of American Political Geography," Working Paper Series rwp06-007, Harvard University, John F. Kennedy School of Government.
  9. Magee, Christopher, 2001. "Administered protection for workers: an analysis of the trade adjustment assistance program," Journal of International Economics, Elsevier, vol. 53(1), pages 105-125, February.
  10. Grossman, Gene & Helpman, Elhanan, 2005. "A Protectionist Bias in Majoritarian Politics," CEPR Discussion Papers 5238, C.E.P.R. Discussion Papers.
  11. Jones, Stephen R. G., 1989. "Have your lawyer call my lawyer : Bilateral delegation in bargaining situations," Journal of Economic Behavior & Organization, Elsevier, vol. 11(2), pages 159-174, March.
  12. Edward L. Glaeser & Bryce A. Ward, 2006. "Myths and Realities of American Political Geography," Journal of Economic Perspectives, American Economic Association, vol. 20(2), pages 119-144, Spring.
  13. Ken Binmore & Ariel Rubinstein & Asher Wolinsky, 1986. "The Nash Bargaining Solution in Economic Modelling," RAND Journal of Economics, The RAND Corporation, vol. 17(2), pages 176-188, Summer.
  14. Robert C. Feenstra, 1997. "U.S. Exports, 1972-1994: With State Exports and Other U.S. Data," NBER Working Papers 5990, National Bureau of Economic Research, Inc.
  15. Robert C. Feenstra & John Romalis & Peter K. Schott, 2002. "U.S. Imports, Exports, and Tariff Data, 1989-2001," NBER Working Papers 9387, National Bureau of Economic Research, Inc.
  16. Karol, David, 2000. "Divided Government and U.S.Trade Policy: Much Ado About Nothing?," International Organization, Cambridge University Press, vol. 54(04), pages 825-844, September.
  17. Putnam, Robert D., 1988. "Diplomacy and domestic politics: the logic of two-level games," International Organization, Cambridge University Press, vol. 42(03), pages 427-460, June.
  18. Edward L. Glaeser & Bryce A. Ward, 2006. "Myths and Realities of American Political Geography," Harvard Institute of Economic Research Working Papers 2100, Harvard - Institute of Economic Research.
  19. Levy, Philip I., 1999. "Lobbying and international cooperation in tariff setting," Journal of International Economics, Elsevier, vol. 47(2), pages 345-370, April.
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Citations

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Cited by:
  1. Conconi, Paola & Facchini, Giovanni & Zanardi, Maurizio, 2011. "Policymakers' Horizon and Trade Reforms," CEPR Discussion Papers 8561, C.E.P.R. Discussion Papers.
  2. Conconi, Paola & Facchini, Giovanni & Steinhardt, Max Friedrich & Zanardi, Maurizio, 2012. "The political economy of trade and migration: Evidence from the US Congress," HWWI Research Papers 136, Hamburg Institute of International Economics (HWWI).
  3. Marco Fugazza & Frédéric Robert-Nicoud, 2011. "The ‘Emulator Effect’ Of The Uruguay Round On United States Regionalism," UNCTAD Blue Series Papers 52, United Nations Conference on Trade and Development.
  4. Barbara Dluhosch & Nikolai Ziegler, 2011. "The paradox of weakness in the politics of trade integration," Constitutional Political Economy, Springer, vol. 22(4), pages 325-354, December.
  5. Facchini, Giovanni & Silva, Peri & Willmann, Gerald, 2012. "The Customs Union issue: Why do we observe so few of them?," CEPR Discussion Papers 9135, C.E.P.R. Discussion Papers.
  6. repec:eca:wpaper:2013/97307 is not listed on IDEAS
  7. repec:ulb:ulbeco:2013/98553 is not listed on IDEAS
  8. Lisa Grazzini & Alessandro Petretto, 2013. "Federalism with Bicameralism," Working Papers Series wp2013_01.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze dell'Economia e Dell'Impresa.
  9. Marco Fugazza & Frédéric Robert-Nicoud, 2010. "The 'Emulator Effect' of the Uruguay Round on US Regionalism," CEP Discussion Papers dp0973, Centre for Economic Performance, LSE.

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