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

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

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    File URL: http://purl.umn.edu/124885
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    Paper provided by Agricultural and Applied Economics Association in its series 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington with number 124885.

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    Date of creation: 12 Aug 2012
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    Handle: RePEc:ags:aaea12:124885
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    1. 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.
    2. Beghin, John C. & Foster, William E. & Kherallah, Mylene, 1996. "Institutions and Market Distortions: International Evidence for Tobacco," Staff General Research Papers 1569, Iowa State University, Department of Economics.
    3. 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.
    4. 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, 01.
    5. 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.
    6. Hamilton, James D., 1990. "Analysis of time series subject to changes in regime," Journal of Econometrics, Elsevier, vol. 45(1-2), pages 39-70.
    7. repec:cup:cbooks:9780521351058 is not listed on IDEAS
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