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Monopoly power, trade protection and growth: cross industry evidence


  • Ferreira, Pedro Cavalcanti


This paper investigates the impact of monopoly power on trade policy. Annual panel-databases of Brazilian industries for the years 1988 through 1994 were used. The regressions reported here are robust to openness indicator, concentration index, control variables and sample size, and suggest that industries with higher monopoly power are more protected than competitive sectors. In the period of study the country experienced a major trade liberalization, but the results in the paper show that the reduction in protection was smaller in sectors with higher monopoly power. We thus have evidence favoring recent growth literature which stresses that interest groups with control over creasing productivity. The results here confirm the first part of this argument and show that organized groups in fact are able to obtain policy advantages that reduce competition.

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  • Ferreira, Pedro Cavalcanti, 2000. "Monopoly power, trade protection and growth: cross industry evidence," FGV/EPGE Economics Working Papers (Ensaios Economicos da EPGE) 381, FGV/EPGE - Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
  • Handle: RePEc:fgv:epgewp:381

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    References listed on IDEAS

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    Cited by:

    1. Adriana Schor, 2004. "Heterogeneous Productivity Response to Tariff Reduction: Evidence from Brazilian Manufacturing Firms," NBER Working Papers 10544, National Bureau of Economic Research, Inc.

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