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Constitutional Rules, Informal Institutions and Agricultural Protection in Developing and Industrial Countries: Theory and Empirical Evidence

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  • Abmann, Christian
  • Henning, Christian H.C.A.
  • Krampe, Eva

Abstract

This paper empirically investigates the interaction of formal and informal political institutions as well as lobbying in determining the ability of agriculture to avoid taxation or attract government transfers. Based on our theory we identify specific interaction effects between district size and characteristic political as well as demographic framework constellation, that determine two different regimes, e.g. an u-shape and an inverse u-shape relation between district size and the level of agricultural protection. Further, our theory implies specific different patterns of how these interaction effects impact on agricultural protection levels in developing and industrialized countries. Using time-series-cross-section (TSCS) data, this paper tackles the quantitative assessment of the theoretical implications. We estimate the latent regime of agricultural protection and assess the opposing quantitative relationships. We check our results for robustness concerning dynamic specification issues and latent heterogeneity. Furthermore we gauge the possible endogeneity of institutions via an extended treatment framework.

Suggested Citation

  • Abmann, Christian & Henning, Christian H.C.A. & Krampe, Eva, 2012. "Constitutional Rules, Informal Institutions and Agricultural Protection in Developing and Industrial Countries: Theory and Empirical Evidence," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124885, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea12:124885
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    File URL: http://purl.umn.edu/124885
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    References listed on IDEAS

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    1. 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.
    2. Tyers,Rod & Anderson,Kym, 2011. "Disarray in World Food Markets," Cambridge Books, Cambridge University Press, number 9780521172318, May.
    3. Keane, Michael P, 1994. "A Computationally Practical Simulation Estimator for Panel Data," Econometrica, Econometric Society, vol. 62(1), pages 95-116, January.
    4. John C. Beghin & William E. Foster & Mylene Kherallah, 1996. "Institutions And Market Distortions: International Evidence For Tobacco," Journal of Agricultural Economics, Wiley Blackwell, vol. 47(1-4), pages 355-365.
    5. Johan F. M. Swinnen & Liesbeth Dries & Karen Macours, 2005. "Transition and agricultural labor," Agricultural Economics, International Association of Agricultural Economists, vol. 32(1), pages 15-34, January.
    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 482-489, August.
    7. Johan F. M. Swinnen, 1994. "A Positive Theory of Agricultural Protection," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 76(1), pages 1-14.
    8. Swinnen, Johan F. M. & Gorter, Harry de & Rausser, Gordon C. & Banerjee, Anurag N., 2000. "The political economy of public research investment and commodity policies in agriculture: an empirical study," Agricultural Economics, Blackwell, vol. 22(2), pages 111-122, March.
    9. Hamilton, James D., 1990. "Analysis of time series subject to changes in regime," Journal of Econometrics, Elsevier, vol. 45(1-2), pages 39-70.
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    Cited by:

    1. Bellemare, Marc F. & Carnes, Nicholas, 2015. "Why do members of congress support agricultural protection?," Food Policy, Elsevier, vol. 50(C), pages 20-34.

    More about this item

    Keywords

    Political Institutions; Political Economy of Agricultural Protectionism; Switch- ing Regimes; Endogeneity of political Institutions; Environmental Economics and Policy;

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