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Trade Wars and Trade Talks

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  • Grossman, Gene M
  • Helpman, Elhanan

Abstract

When governments meet in the international arena, their actions reflect the political situations at home. Previous studies of trade relations have focused on governments that are immune from political pressures and that act as benevolent servants of the public interest. Here the authors introduce domestic politics into the analysis of international economic relations. They study the interactions between national leaders who are concerned with both providing a high standard of living to the general electorate and collecting campaign contributions from special-interest groups. The authors' analysis sheds light on the determinants of the structure of protection in noncooperative and cooperative policy equilibria. Copyright 1995 by University of Chicago Press.

Suggested Citation

  • Grossman, Gene M & Helpman, Elhanan, 1995. "Trade Wars and Trade Talks," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 675-708, August.
  • Handle: RePEc:ucp:jpolec:v:103:y:1995:i:4:p:675-708
    DOI: 10.1086/261999
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    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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