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The Common External Tariff in a Customs Union: Voting, Logrolling, and National Government Interests

  • Tavares, Samia
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    Missing from the analysis of customs unions has been a consideration of collective decisionmaking by countries regarding the union’s common trade policy. In the case of the common European external tariff, how governments voted was not public information. This paper uses a unique dataset to derive member states’ tariff preferences, which are then used to establish the decision rule before 1987, when individual governments had veto power. Results indicate a principle of unanimity, as well as the presence of logrolling. The political equilibrium for the common external tariff is also illustrated to have shifted as a result of union enlargements.

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    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 959.

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    Date of creation: 25 Jul 2006
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    Handle: RePEc:pra:mprapa:959
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    1. L. Wade, 1988. "Review," Public Choice, Springer, vol. 58(1), pages 99-100, July.
    2. Romer, Thomas & Rosenthal, Howard, 1982. "Median Voters or Budget Maximizers: Evidence from School Expenditure Referenda," Economic Inquiry, Western Economic Association International, vol. 20(4), pages 556-78, October.
    3. Hillman, Arye L, 1982. "Declining Industries and Political-Support Protectionist Motives," American Economic Review, American Economic Association, vol. 72(5), pages 1180-87, December.
    4. Giovanni Maggi & Pinelopi Koujianou Goldberg, 1999. "Protection for Sale: An Empirical Investigation," American Economic Review, American Economic Association, vol. 89(5), pages 1135-1155, December.
    5. Hillman, Arye L & Ursprung, Heinrich W, 1988. "Domestic Politics, Foreign Interests, and International Trade Policy," American Economic Review, American Economic Association, vol. 78(4), pages 719-45, September.
    6. Widgren, Mika, 1994. "Voting power in the EC decision making and the consequences of two different enlargements," European Economic Review, Elsevier, vol. 38(5), pages 1153-1170, May.
    7. 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.
    8. Long, N.V. & Soubeyran, A. & Hillman, A., 1998. "Protection, Lobbying, and Market Structure," G.R.E.Q.A.M. 98a24, Universite Aix-Marseille III.
    9. Pecorino, Paul, 1998. "Is There a Free-Rider Problem in Lobbying? Endogenous Tariffs, Trigger Strategies, and the Number of Firms," American Economic Review, American Economic Association, vol. 88(3), pages 652-60, June.
    10. Davidson, Russell & MacKinnon, James G, 1981. "Several Tests for Model Specification in the Presence of Alternative Hypotheses," Econometrica, Econometric Society, vol. 49(3), pages 781-93, May.
    11. Jong-Wha Lee & Phillip Swagel, 1994. "Trade barriers and trade flows across countries and industries," International Finance Discussion Papers 476, Board of Governors of the Federal Reserve System (U.S.).
    12. Ronald Findlay & Stanislaw Wellisz, 1982. "Endogenous Tariffs, the Political Economy of Trade Restrictions, and Welfare," NBER Chapters, in: Import Competition and Response, pages 223-244 National Bureau of Economic Research, Inc.
    13. Mayer, Wolfgang, 1984. "Endogenous Tariff Formation," American Economic Review, American Economic Association, vol. 74(5), pages 970-85, December.
    14. Olarreaga, Marcelo & Soloaga, Isidro & Winters, Alan, 1999. "What's behind MERCOSUR's common external tariff?," Policy Research Working Paper Series 2231, The World Bank.
    15. Trefler, Daniel, 1993. "Trade Liberalization and the Theory of Endogenous Protection: An Econometric Study of U.S. Import Policy," Journal of Political Economy, University of Chicago Press, vol. 101(1), pages 138-60, February.
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