Advanced Search
MyIDEAS: Login to save this paper or follow this series

The Political Economy of Policy Instrument Choice: Theory and Evidence from Agricultural Policies

Contents:

Author Info

  • Johan F.M.Swinnen
  • Alessandro Olper
  • Thijs Vandemoortele

Abstract

We study the political economy of instrument choice in agricultural and food policies. After a review of the historical evolution of European agricultural price and trade policy instruments since 1880, we develop a political economy model of instrument choice. The key predictions of the model suggest a rational explanation of instrument choice patterns, based on the trade-off between the different cost components of the policies, and internal and external political constraints. An empirical analysis supports the main predictions of the theoretical model. We find that the GATT/WTO agreement had a significant impact.

Download Info

If 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.
File URL: http://www.econ.kuleuven.be/licos/publications/dp/dp279.pdf
Download Restriction: no

Bibliographic Info

Paper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 27911.

as in new window
Length:
Date of creation: 2011
Date of revision:
Handle: RePEc:lic:licosd:27911

Contact details of provider:
Postal: De Bériotstraat 34, B-3000 Leuven
Phone: +32 (0) 16 / 32 6598
Fax: +32 (0) 16 / 32 6599
Email:
Web page: http://www.econ.kuleuven.be/licos
More information through EDIRC

Related research

Keywords: Political Economy; Instrument Choice; Agricultural Policy; GATT; WTO;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. James A. Brander & Barbara J. Spencer, 1983. "Strategic Commitment with R&D: The Symmetric Case," Bell Journal of Economics, The RAND Corporation, vol. 14(1), pages 225-235, Spring.
  2. Rodrik, Dani, 1986. "Tariffs, subsidies, and welfare with endogenous policy," Journal of International Economics, Elsevier, vol. 21(3-4), pages 285-299, November.
  3. Grossman, G.M. & Helpman, E., 1993. "Trade Wars and Trade Talks," Papers 1-93, Tel Aviv.
  4. Timothy Besley & Torsten Persson & Daniel M. Sturm, 2010. "Political Competition, Policy and Growth: Theory and Evidence from the US," Review of Economic Studies, Oxford University Press, vol. 77(4), pages 1329-1352.
  5. Gardner, Bruce L, 1987. "Causes of U.S. Farm Commodity Programs," Journal of Political Economy, University of Chicago Press, vol. 95(2), pages 290-310, April.
  6. Beghin, John C & Kherallah, Mylene, 1994. "Political Institutions and International Patterns of Agricultural Protection," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 482-89, August.
  7. Robert W. Staiger & Kyle Bagwell, 1999. "An Economic Theory of GATT," American Economic Review, American Economic Association, vol. 89(1), pages 215-248, March.
  8. Per Kristian Rørstad & Arild Vatn & Valborg Kvakkestad, 2007. "Why do transaction costs of agricultural policies vary?," Agricultural Economics, International Association of Agricultural Economists, vol. 36(1), pages 1-11, 01.
  9. Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 21-92, Tel Aviv.
  10. Olper, Alessandro & Raimondi, Valentina, 2009. "Constitutional Rules and Agricultural Policy Outcomes," Agricultural Distortions Working Paper 50304, World Bank.
  11. Cassing, James H. & Hillman, Arye L., 1985. "Political influence motives and the choice between tariffs and quotas," Journal of International Economics, Elsevier, vol. 19(3-4), pages 279-290, November.
  12. Rausser, Gordon C., 1991. "Predatory versus productive government : the case of U.S. agricultural policies," CUDARE Working Paper Series 613, University of California at Berkeley, Department of Agricultural and Resource Economics and Policy.
  13. Giovanni Maggi & Andrés Rodríguez-Clare, 2007. "A Political-Economy Theory of Trade Agreements," American Economic Review, American Economic Association, vol. 97(4), pages 1374-1406, September.
  14. Johan F. M. Swinnen & Harry de Gorter, 2002. "On government credibility, compensation and under-investment in public research," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(4), pages 501-522, December.
  15. Hillman, Arye L, 1982. "Declining Industries and Political-Support Protectionist Motives," American Economic Review, American Economic Association, vol. 72(5), pages 1180-87, December.
  16. Josling, Tim & Tangermann, Stefan, 1999. "Implementation of the WTO Agreement on Agriculture and Developments for the Next Round of Negotiations," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 26(3), pages 371-88, August.
  17. Foster, William E & Rausser, Gordon C, 1993. " Price-Distorting Compensation Serving the Consumer and Taxpayer Interest," Public Choice, Springer, vol. 77(2), pages 275-91, October.
  18. Hillman, Arye L & Ursprung, Heinrich W, 1988. "Domestic Politics, Foreign Interests, and International Trade Policy," American Economic Review, American Economic Association, vol. 78(4), pages 719-45, September.
  19. Daron Acemoglu, 2002. "Why Not a Political Coase Theorem? Social Conflict, Commitment and Politics," NBER Working Papers 9377, National Bureau of Economic Research, Inc.
  20. Olper, Alessandro, 2007. "Land inequality, government ideology and agricultural protection," Food Policy, Elsevier, vol. 32(1), pages 67-83, February.
  21. Munk, K J, 1989. "Price Support to the EC Agricultural Sector: An Optimal Policy?," Oxford Review of Economic Policy, Oxford University Press, vol. 5(2), pages 76-89, Summer.
  22. Matthew F. Mitchell & Andrea Moro, 2006. "Persistent Distortionary Policies with Asymmetric Information," American Economic Review, American Economic Association, vol. 96(1), pages 387-393, March.
  23. Dixit, Avinash, 1984. "International Trade Policy for Oligopolistic Industries," Economic Journal, Royal Economic Society, vol. 94(376a), pages 1-16, Supplemen.
  24. Ray, Edward John, 1981. "The Determinants of Tariff and Nontariff Trade Restrictions in the United States," Journal of Political Economy, University of Chicago Press, vol. 89(1), pages 105-21, February.
  25. Giovanni Maggi & Andres Rodriguez-Clare, 1998. "Import Peneteration and the Politics of Trade Protection," NBER Working Papers 6711, National Bureau of Economic Research, Inc.
  26. D. MacLaren, 1991. "Agricultural Trade Policy Analysis And International Trade Theory: A Review Of Recent Developments," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(3), pages 250-297.
  27. Kyle Bagwell & Robert W. Staiger, 2005. "Will international rules on subsidies disrupt the world trading system?," Discussion Papers 0405-21, Columbia University, Department of Economics.
  28. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
  29. Burgess, Robin & Stern, Nicholas, 1993. "Taxation and Development," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 762-830, June.
  30. Arild Vatn, 2002. "Multifunctional agriculture: some consequences for international trade regimes," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 29(3), pages 309-327, July.
  31. Johan F.M. Swinnen, 2010. "The Political Economy of Agricultural and Food Policies: Recent Contributions, New Insights, and Areas for Further Research," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 32(1), pages 33-58.
  32. David S. Bullock & Klaus Salhofer & Jukka Kola, 1999. "The Normative Analysis of Agricultural Policy: A General Framework and Review," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(3), pages 512-535.
  33. 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.
  34. Stefan Tangermann, 1999. "Europe's Agricultural Policies and the Millennium Round," The World Economy, Wiley Blackwell, vol. 22(9), pages 1155-1178, December.
  35. Olson, Mancur, 1990. "AGRICULTURAL EXPLOITATION AND SUBSIDIZATION: There Is An Explanation," Choices, Agricultural and Applied Economics Association, vol. 5(4).
  36. Swinnen, Johan F. M. & Banerjee, Anurag N. & Gorter, Harry de, 2001. "Economic development, institutional change, and the political economy of agricultural protection: An econometric study of Belgium since the 19th century," Agricultural Economics, Blackwell, vol. 26(1), pages 25-43, October.
  37. Honma, Masayoshi & Hayami, Yujiro, 1986. "Structure of agricultural protection in industrial countries," Journal of International Economics, Elsevier, vol. 20(1-2), pages 115-129, February.
  38. Johan F. M. Swinnen & Harry Gorter, 1993. "Why Small Groups And Low Income Sectors Obtain Subsidies: The "Altruistic" Side Of A "Self-Interested" Government," Economics and Politics, Wiley Blackwell, vol. 5(3), pages 285-293, November.
  39. Wittman, Donald, 1989. "Why Democracies Produce Efficient Results," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1395-1424, December.
  40. Lindbeck, Assar, 1985. "Redistribution policy and the expansion of the public sector," Journal of Public Economics, Elsevier, vol. 28(3), pages 309-328, December.
  41. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Anderson, Kym & Rausser, Gordon & Swinnen, Johan, 2013. "Political economy of public policies : insights from distortions to agricultural and food markets," Policy Research Working Paper Series 6433, The World Bank.
  2. Jeroen Klomp & Jakob de Haan, 2013. "Conditional Election and Partisan Cycles in Government Support to the Agricultural Sector: An Empirical Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(4), pages 793-818.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:lic:licosd:27911. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.