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The sources of protectionist drift in representative democracies

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  • Laussel, Didier
  • Riezman, Raymond

Abstract

We analyze a two country-two goods model of international trade in which citizens in each country differ by their specific factor endowments. The trade policy in each country is set by the politician who has been elected by the citizens in a previous stage. Due to a delegation effect citizens generally favor candidates who are more protectionist than they are. The (multiple) one candidate per country-equilibria exhibit a ''protectionist drift'' owing to this delegation effect and an abstention effect.

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Bibliographic Info

Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 49 (2005)
Issue (Month): 7 (October)
Pages: 1855-1876

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Handle: RePEc:eee:eecrev:v:49:y:2005:i:7:p:1855-1876

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References

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  1. Gatsios, Konstantine & Karp, Larry, 1991. "Delegation Games in Customs Unions," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 391-97, April.
  2. Torsten Persson & Guido Tabellini, 1990. "The Politics of 1992: Fiscal Policy and European Integration," NBER Working Papers 3460, National Bureau of Economic Research, Inc.
  3. Martin J. Osborne & Al Slivinksi, 1995. "A Model of Political Competition with Citizen-Candidates," Department of Economics Working Papers 1995-01, McMaster University.
  4. Tim Besley & Stephen Coate, . "An Economic Model of Representative Democracy," Penn CARESS Working Papers ecf70d639d700dba5327ab0c8, Penn Economics Department.
  5. V. V. Chari & Larry E. Jones & Ramon Marimon, 1997. "The economics of split-ticket voting in representative democracies," Working Papers 582, Federal Reserve Bank of Minneapolis.
  6. Persson, Torsten & Tabellini, Guido, 1996. "Federal Fiscal Constitutions: Risk Sharing and Moral Hazard," Econometrica, Econometric Society, vol. 64(3), pages 623-46, May.
  7. Besley, Timothy J. & Coate, Stephen, 2000. "Centralized versus Decentralized Provision of Local Public Goods: a Political Economy Analysis," CEPR Discussion Papers 2495, C.E.P.R. Discussion Papers.
  8. Rodrik, Dani, 1995. "Political economy of trade policy," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 28, pages 1457-1494 Elsevier.
  9. Kennan, John & Riezman, Raymond, 1988. "Do Big Countries Win Tariff Wars?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 29(1), pages 81-85, February.
  10. Mayer, Wolfgang, 1984. "Endogenous Tariff Formation," American Economic Review, American Economic Association, vol. 74(5), pages 970-85, December.
  11. Besley, Timothy & Coate, Stephen, 1998. "Sources of Inefficiency in a Representative Democracy: A Dynamic Analysis," American Economic Review, American Economic Association, vol. 88(1), pages 139-56, March.
  12. Gatsios, Konstantine & Karp, Larry, 1995. "Delegation in a general equilibrium model of customs unions," European Economic Review, Elsevier, vol. 39(2), pages 319-333, February.
  13. Persson, Torsten & Tabellini, Guido, 1994. "Representative democracy and capital taxation," Journal of Public Economics, Elsevier, vol. 55(1), pages 53-70, September.
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Cited by:
  1. Giovanni Facchini & Peri Silva & Gerald Willmann, 2008. "The Customs Union issue: Why do we observe so few of them?," Center for Economic Studies - Discussion papers ces0827, Katholieke Universiteit Leuven, Centrum voor Economische Studiƫn.
  2. H.J. Roelfsema, 2004. "Strategic Delegation of Environmental Policy Making," Working Papers 04-11, Utrecht School of Economics.
  3. Keisuke Hattori, 2010. "Strategic Voting for Noncooperative Environmental Policies in Open Economies," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 46(4), pages 459-474, August.

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