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Constitutional Rules, Informal Institutions and Agricultural Protection in Developing and Industrial Countries: Theory and Empirical Evidence

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  • Abmann, Christian
  • Henning, Christian H.C.A.
  • Krampe, Eva
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    Abstract

    This paper empirically investigates the interaction of formal and informal political institutions as well as lobbying in determining the ability of agriculture to avoid taxation or attract government transfers. Based on our theory we identify specific interaction effects between district size and characteristic political as well as demographic framework constellation, that determine two different regimes, e.g. an u-shape and an inverse u-shape relation between district size and the level of agricultural protection. Further, our theory implies specific different patterns of how these interaction effects impact on agricultural protection levels in developing and industrialized countries. Using time-series-cross-section (TSCS) data, this paper tackles the quantitative assessment of the theoretical implications. We estimate the latent regime of agricultural protection and assess the opposing quantitative relationships. We check our results for robustness concerning dynamic specification issues and latent heterogeneity. Furthermore we gauge the possible endogeneity of institutions via an extended treatment framework.

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    Bibliographic Info

    Paper provided by Agricultural and Applied Economics Association in its series 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington with number 124885.

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    Date of creation: 12 Aug 2012
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    Handle: RePEc:ags:aaea12:124885

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    Related research

    Keywords: Political Institutions; Political Economy of Agricultural Protectionism; Switch- ing Regimes; Endogeneity of political Institutions; Environmental Economics and Policy;

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    1. Tyers,Rod & Anderson,Kym, 1992. "Disarray in World Food Markets," Cambridge Books, Cambridge University Press, number 9780521351058, April.
    2. Swinnen, Johan F. M. & Gorter, Harry de & Rausser, Gordon C. & Banerjee, Anurag N., 2000. "The political economy of public research investment and commodity policies in agriculture: an empirical study," Agricultural Economics, Blackwell, vol. 22(2), pages 111-122, March.
    3. Johan F. M. Swinnen & Liesbeth Dries & Karen Macours, 2005. "Transition and agricultural labor," Agricultural Economics, International Association of Agricultural Economists, vol. 32(1), pages 15-34, 01.
    4. John C. Beghin & William E. Foster & Mylene Kherallah, 1996. "Institutions And Market Distortions: International Evidence For Tobacco," Journal of Agricultural Economics, Wiley Blackwell, vol. 47(1-4), pages 355-365.
    5. Hamilton, James D., 1990. "Analysis of time series subject to changes in regime," Journal of Econometrics, Elsevier, vol. 45(1-2), pages 39-70.
    6. De Gorter, Harry & Swinnen, Johan, 2002. "Political economy of agricultural policy," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 2, chapter 36, pages 1893-1943 Elsevier.
    7. Beghin, John C. & Kherallah, Mylene, 1994. "Political Institutions and International Patterns of Agricultural Protection," Staff General Research Papers 1602, Iowa State University, Department of Economics.
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    Cited by:
    1. Bellemare, Marc F. & Carnes, Nicholas, 2013. "Why Do Members of Congress Support Agricultural Protection?," MPRA Paper 47629, University Library of Munich, Germany.

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