IDEAS home Printed from https://ideas.repec.org/a/fip/fedlrv/y2011imarp89-104nv.93no.2.html
   My bibliography  Save this article

Political economy determinants of non-agricultural trade policy

Author

Listed:
  • Subhayu Bandyopadhyay
  • Suryadipta Roy

Abstract

The authors investigate several existing political economy hypotheses on trade policy using cross-country trade-protection data for non-agricultural goods. The authors find that a left-leaning political regime leads to pro-labor trade policies only for a subset of trade policy measures. In addition, they find that income inequality and country-level corruption appear to be important determinants of trade policy. For various measures of trade protection, it appears that corruption tends to hurt labor interests by increasing trade protection in labor-abundant countries and reducing trade protection in capital-abundant countries. This finding suggests that corruption, among other factors, may move trade policy away from the desires of the median voter.

Suggested Citation

  • Subhayu Bandyopadhyay & Suryadipta Roy, 2011. "Political economy determinants of non-agricultural trade policy," Review, Federal Reserve Bank of St. Louis, issue Mar, pages 89-104.
  • Handle: RePEc:fip:fedlrv:y:2011:i:mar:p:89-104:n:v.93no.2
    as

    Download full text from publisher

    File URL: https://files.stlouisfed.org/files/htdocs/publications/review/11/03/89-104Bandyopadhyay.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Barseghyan, Levon & DiCecio, Riccardo, 2011. "Cross-country income convergence revisited," Economics Letters, Elsevier, vol. 113(3), pages 244-247.
    2. Easterly, William, 2007. "Inequality does cause underdevelopment: Insights from a new instrument," Journal of Development Economics, Elsevier, vol. 84(2), pages 755-776, November.
    3. 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.
    4. Neeman Zvika & Paserman M. Daniele & Simhon Avi, 2008. "Corruption and Openness," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 8(1), pages 1-40, December.
    5. Suryadipta Roy, 2010. "Is corruption anti-labour?," Applied Economics Letters, Taylor & Francis Journals, vol. 17(4), pages 329-333.
    6. Dutt, Pushan & Mitra, Devashish, 2006. "Labor versus capital in trade-policy: The role of ideology and inequality," Journal of International Economics, Elsevier, vol. 69(2), pages 310-320, July.
    7. Dutt, Pushan & Mitra, Devashish, 2002. "Endogenous trade policy through majority voting: an empirical investigation," Journal of International Economics, Elsevier, vol. 58(1), pages 107-133, October.
    8. Michael P. Murray, 2006. "Avoiding Invalid Instruments and Coping with Weak Instruments," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 111-132, Fall.
    9. Milner, Helen V. & Kubota, Keiko, 2005. "Why the Move to Free Trade? Democracy and Trade Policy in the Developing Countries," International Organization, Cambridge University Press, vol. 59(01), pages 107-143, January.
    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


    Cited by:

    1. repec:bla:worlde:v:40:y:2017:i:9:p:1807-1835 is not listed on IDEAS
    2. Konov, Joshua Ioji / JK, 2013. "Enhancing Markets (i.e. Economies) Transmissionability to Optimize Monetary Policies’ Effect," MPRA Paper 46950, University Library of Munich, Germany.
    3. Konov, Joshua Ioji, 2012. "Market Economy under Rapid Globalization and Rising Productivity," MPRA Paper 48750, University Library of Munich, Germany.
    4. Gianluca Orefice, 2017. "Non-Tariff Measures, Specific Trade Concerns and Tariff Reduction," The World Economy, Wiley Blackwell, vol. 40(9), pages 1807-1835, September.
    5. Sondra Collins & Edward Nissan, 2016. "Comparing Africa, Asia and Latin America/Caribbean countries using per capita GDP, remittances, openness, capital/labor ratios and freedom," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 40(1), pages 188-198, January.

    More about this item

    Keywords

    International trade ; Corruption ; Tariff;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedlrv:y:2011:i:mar:p:89-104:n:v.93no.2. 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: (Kathy Cosgrove). General contact details of provider: http://edirc.repec.org/data/frbslus.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.