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Political Ideology and Endogenous Trade Policy: An Empirical Investigation

Author

Listed:
  • Pushan Dutt

    (University of Alberta)

  • Devashish Mitra

    (Syracuse University and NBER)

Abstract

In this paper, we investigate empirically how government ideology affects trade policy. The prediction of a partisan, ideology-based model (within a two-sector, two-factor Heckscher-Ohlin framework) is that left-wing governments will adopt more protectionist trade policies in capital-rich countries, but adopt more pro-trade policies in labor-rich countries, than right-wing ones. The data strongly support this prediction in a very robust fashion. There is some evidence that this relationship may hold better in democracies than in dictatorships, though the magnitude of the partisan effect seems stronger in dictatorships. © 2005 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Pushan Dutt & Devashish Mitra, 2005. "Political Ideology and Endogenous Trade Policy: An Empirical Investigation," The Review of Economics and Statistics, MIT Press, vol. 87(1), pages 59-72, February.
    • Handle: RePEc:tpr:restat:v:87:y:2005:i:1:p:59-72
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    References listed on IDEAS

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    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade

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