Politically Imposed Entry Barriers
AbstractThe antitrust agencies analyze consequences of proposed mergers assuming that imports are constrained by existing quotas, a second-best approach. This policy is flawed. Quotas are endogenous. If a merger allows firms to reduce output, the quota will be increased. If an industry has sufficient political power to obtain subsidies from government then the authorities should assume that these subsidies will be reduced if market power increases. Paradoxically, for political entry barriers truly in the public interest, the antitrust authorities should take the barrier as given. We provide evidence of a large adjustment of tariffs to changes in market power.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Eastern Economic Association in its journal Eastern Economic Journal.
Volume (Year): 18 (1992)
Issue (Month): 3 (Summer)
Contact details of provider:
Postal: c/o Dr. Alexandre Olbrecht, The Anisfield School of Business 205, Ramapo College, 505 Ramapo Valley Road, Ramapo, New Jersey 07430, USA
Phone: (201) 684-7346
Web page: http://www.ramapo.edu/eea/journal.html
More information through EDIRC
Firm; Government; Import; Merger; Policy; Political; Quotas; Subsidies;
Find related papers by JEL classification:
- L40 - Industrial Organization - - Antitrust Issues and Policies - - - General
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Richard E. Caves, 1976. "Economic Models of Political Choice: Canada's Tariff Structure," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 9(2), pages 278-300, May.
- McKee, Michael & West, Edwin G, 1981. "The Theory of Second Best: A Solution in Search of a Problem," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 19(3), pages 436-48, July.
- Buchanan, James M & Lee, Dwight R, 1992. "Private Interest Support for Efficiency Enhancing Antitrust Policies," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 30(2), pages 218-24, April.
- Faith, Roger L & Leavens, Donald R & Tollison, Robert D, 1982. "Antitrust Pork Barrel," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 25(2), pages 329-42, October.
- Hazlett, Thomas W, 1992. "The Legislative History of the Sherman Act Re-examined," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 30(2), pages 263-76, April.
- Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 98(3), pages 371-400, August.
- William M. Landes & Richard A. Posner, 1975.
"The Independent Judiciary in an Interest-Group Perspective,"
NBER Working Papers
0110, National Bureau of Economic Research, Inc.
- Landes, William M & Posner, Richard A, 1975. "The Independent Judiciary in an Interest-Group Perspective," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 18(3), pages 875-901, December.
- Noam, Eli, 1984. "Market Power and Regulation: A Simultaneous Approach," Journal of Industrial Economics, Wiley Blackwell, Wiley Blackwell, vol. 32(3), pages 335-47, March.
- Godek, Paul E, 1985. "Industry Structure and Redistribution through Trade Restrictions," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 28(3), pages 687-703, October.
- Steven Globerman, 1990. "Trade liberalization and competitive behavior: A note assessing the evidence and the public policy implications," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 9(1), pages 80-88.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Victor Matheson, College of the Holy Cross).
If references are entirely missing, you can add them using this form.