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Market Access for Sale: Latin America's Lobbying for US Tariff Preferences

  • Kee, Hiau Looi
  • Olarreaga, Marcelo
  • Silva, Peri

This Paper assesses the foreign lobbying forces behind the tariff preferences that the United States grants to Latin American countries. The basic framework is one developed by Grossman and Helpman (1994) that is extended to explain the relationship between foreign lobbying and tariff preferences. Results suggest that returns to Latin American exporters lobbying for tariff preferences in the United States are above 50%. The reason for these large returns is the relatively low estimated weight given to social welfare in the US government’s objective function when deciding whether or not to grant tariff preferences to LAC exporters.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4077.

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Date of creation: Oct 2003
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Handle: RePEc:cpr:ceprdp:4077
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  1. Kishore Gawande & Usree Bandyopadhyay, 2000. "Is Protection for Sale? Evidence on the Grossman-Helpman Theory of Endogenous Protection," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 139-152, February.
  2. Devashish Mitra & Dimitrios D. Thomakos & Mehmet A. Ulubaşoglu, 2002. ""Protection For Sale" In A Developing Country: Democracy Vs. Dictatorship," The Review of Economics and Statistics, MIT Press, vol. 84(3), pages 497-508, August.
  3. Pinelopi Koujianou Goldbe & Giovanni Maggi, 1997. "Protection for Sale: An Empirical Investigation," NBER Working Papers 5942, National Bureau of Economic Research, Inc.
  4. Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 162, Princeton, Woodrow Wilson School - Public and International Affairs.
  5. kishore gawande & pravin krishna, 2005. "The Political Economy of Trade Policy: Empirical Approaches," International Trade 0503003, EconWPA.
  6. Devashish Mitra, 1999. "Endogenous Lobby Formation and Endogenous Protection: A Long-Run Model of Trade Policy Determination," American Economic Review, American Economic Association, vol. 89(5), pages 1116-1134, December.
  7. Gawande, Kishore, 1997. "Generated regressors in linear and nonlinear models," Economics Letters, Elsevier, vol. 54(2), pages 119-126, February.
  8. Kishore Gawande & Pravin Krishna & Michael J. Robbins, 2004. "Foreign Lobbies and US Trade Policy," NBER Working Papers 10205, National Bureau of Economic Research, Inc.
  9. Cadot, Olivier & de Melo, Jaime & Olarreaga, Marcelo, 2003. "The protectionist bias of duty drawbacks: evidence from Mercosur," Journal of International Economics, Elsevier, vol. 59(1), pages 161-182, January.
  10. Dickins, William T, 1990. "Error Components in Grouped Data: Is It Ever Worth Weighting?," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 328-33, May.
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