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Inter-Regional Trade and Lobbying

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Author Info

  • Sergei Guriev

    (New Economic School (NES), Center for Economic and Financial Research (CEFIR), Center for Economic Policy Research (CEPR))

  • Evgeny Yakovlev

    (University of California, Berkeley)

  • Ekaterina Zhuravskaya

    ()
    (New Economic School (NES), Center for Economic and Financial Research (CEFIR), Center for Economic Policy Research (CEPR))

Abstract

In a federation, local policies with inter-regional spillovers depend on the extent and the nature of local capture. Local lobbyists who have multi-regional scope internalize inter-jurisdictional externalities to a larger extent than the lobbyists with interests in a single region. In particular, multi-regional industrial groups lobby for lower interregional trade barriers than local industrial lobbies. The results are based on a simple model, case-study evidence, and econometric analysis of micro-level panel data from Russia. Controlling for firm-level fixed effects, the performance of firms increases with an increase in the number of neighboring regions captured by multiregional groups. The paper has implications for international trade: lobbying by multinationals should lead to lower protectionism compared to lobbying by national corporations.

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Bibliographic Info

Paper provided by Center for Economic and Financial Research (CEFIR) in its series Working Papers with number w0100.

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Length: 36 pages
Date of creation: Apr 2007
Date of revision:
Handle: RePEc:cfr:cefirw:w0100

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  1. Konstantin Sonin, 2002. "Why the Rich May Favor Poor Protection of Property Rights," William Davidson Institute Working Papers Series 544, William Davidson Institute at the University of Michigan.
  2. Musgrave, Richard A, 1969. "Theories of Fiscal Federalism," Public Finance = Finances publiques, , vol. 24(4), pages 521-36.
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  6. Yingyi Qian & Gerard Roland, . "Federalism and the Soft Budget Constraint," Working Papers 97045, Stanford University, Department of Economics.
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  9. Sandra Poncet, 2004. "A Fragmented China," Tinbergen Institute Discussion Papers 04-103/2, Tinbergen Institute.
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Cited by:
  1. Libman, Alexander, 2008. "Federalism and regionalism in transition countries: A survey," MPRA Paper 29196, University Library of Munich, Germany.
  2. Libman, Alexander, 2009. "Russian federalism and post-Soviet integration: Divergence of development paths," MPRA Paper 12944, University Library of Munich, Germany.

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