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Reconsidering the empirical evidence on the Grossman‐Helpman model of endogenous protection

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  • Josh Ederington
  • Jenny Minier

Abstract

. The emergence of the Grossman and Helpman (1994) model of endogenous protection as the preëminent model in the political economy of trade literature has been significantly advanced by the finding that its predictions about the cross‐industry pattern of protection are broadly consistent with the data. However, in their empirical implementation of the Grossman‐Helpman model, researchers have assumed the presence of multiple policy instruments and extraneous political factors. We argue that incorporating these assumptions into the theory significantly changes its predictions about the cross‐industry pattern of protection. JEL classification: F1 L'émergence du modèle de protection endogène de Grossman‐Helpman en tant que modèle le plus important dans la littérature sur l'économie politique du commerce international a été confirmée de manière significative quand on a découvert que ses prédictions quant au pattern de protection à travers les industries se trouvaient généralement confirmées par les données. Cependant, dans leur vérification empirique du modèle de Grossman‐Helpman, les chercheurs ont postulé la présence de multiples instruments de politique publique et de certains facteurs politiques. On suggère que l'ajout de ces postulats change de manière significative les prédictions du modèle quant au pattern de protection dans les divers secteurs.

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  • Josh Ederington & Jenny Minier, 2008. "Reconsidering the empirical evidence on the Grossman‐Helpman model of endogenous protection," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 41(2), pages 501-516, May.
  • Handle: RePEc:wly:canjec:v:41:y:2008:i:2:p:501-516
    DOI: 10.1111/j.1540-5982.2008.00472.x
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    Cited by:

    1. Ludema, Rodney D & Mayda, Anna Maria & Mishra, Prachi, 2010. "Protection for Free? The Political Economy of U.S. Tariff Suspensions," CEPR Discussion Papers 7926, C.E.P.R. Discussion Papers.
    2. Imai, Susumu & Katayama, Hajime & Krishna, Kala, 2013. "A quantile-based test of protection for sale model," Journal of International Economics, Elsevier, vol. 91(1), pages 40-52.
    3. Jianxing Lyu & Sören Prehn & Yanjie Zhang & Thomas Glauben & Yinchu Zeng, 2021. "Trade creation, political sensitivity and product exclusions: the political economy of agriculture protection in China’s FTAs," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(3), pages 627-657, July.
    4. Imai, Susumu & Katayama, Hajime & Krishna, Kala, 2009. "Is protection really for sale? A survey and directions for future research," International Review of Economics & Finance, Elsevier, vol. 18(2), pages 181-191, March.
    5. Per G. Fredriksson & Khawaja A. Mamun, 2014. "Tobacco Politics and Electoral Accountability in the United States," Public Finance Review, , vol. 42(1), pages 4-34, January.
    6. Predrag Rajsic & Glenn Fox, 2016. "Environmental Externalities, Comparative Advantage, and the Location of Production: An Application to the Canadian Dairy Industry," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 64(2), pages 311-337, June.
    7. Enrico Marvasi, 2013. "Protection for Sale, Monopolistic Competition and Variable Markups," Working Papers - Economics wp2013_11.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    8. Olper, Alessandro, 2017. "The political economy of trade-related regulatory policy: environment and global value chain," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 5(3), February.
    9. Per G. Fredriksson & Xenia Matschke & Jenny Minier, 2011. "Trade policy in majoritarian systems: the case of the U.S," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 44(2), pages 607-626, May.
    10. Per G. Fredriksson & Xenia Matschke & Jenny Minier, 2008. "For Sale: Trade Policy in Majoritarian Systems," Working papers 2008-20, University of Connecticut, Department of Economics.
    11. Barbara Annicchiarico & Enrico Marvasi, 2018. "Protection for Sale with Price Interactions and Incomplete Pass-Through," CEIS Research Paper 435, Tor Vergata University, CEIS, revised 08 Jun 2018.
    12. Etienne Farvaque & Gael Lagadec, 2009. "Electoral Control when Policies are for Sale," CESifo Working Paper Series 2522, CESifo.
    13. Annicchiarico, Barbara & Marvasi, Enrico, 2019. "Protection for sale under monopolistic competition: Beyond the CES," European Journal of Political Economy, Elsevier, vol. 60(C).

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