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Trade Liberalization and Industrial Concentration:Evidence from Brazil

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  • Giovanni Facchini; Pedro Cavalcanti Ferreira

Abstract

This paper applies an endogenous lobby formation model to explain the extent of trade protection granted to Brazilian manufacturing industries during the 1988-1994 trade liberalization episode. Using a panel data set covering this period, we find that even in an environment in which a major regime shift has been introduced,more concentrated sectors have been able to obtain policy advantages, that lead to a reduction in international competition. The importance of industry structure appears to be substantial: In our baseline speci.cation, an increase in concentration by 20% leads to an increase in protection by 5%-7%.

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Bibliographic Info

Paper provided by Econometric Society in its series Econometric Society 2004 Latin American Meetings with number 126.

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Date of creation: 11 Aug 2004
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Handle: RePEc:ecm:latm04:126

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Keywords: lobby formation; tariffs;

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Cited by:
  1. Flôres Junior, Renato Galvão, 2004. "On the use(fulness) of CGE modelling in trade negotiations and policy," Economics Working Papers (Ensaios Economicos da EPGE) 564, FGV/EPGE Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
  2. Jørn Rattsø & Torfinn Harding, 2009. "Industrial labor productivities and tariffs in South Africa: Identification based on multilateral liberalization reform," Working Paper Series 10309, Department of Economics, Norwegian University of Science and Technology.
  3. Karacaovali, Baybars, 2006. "Productivity matters for trade policy : theory and evidence," Policy Research Working Paper Series 3925, The World Bank.

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