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Contesting an international trade agreement

Author

Listed:
  • Matthew T. Cole

    (California Polytechnic State University)

  • James Lake

    (Southern Methodist University)

  • Ben Zissimos

    (University of Exeter Business School)

Abstract

We develop a new theoretical political economy framework, called a "parallel contest", that emphasizes the political fight over trade agreement (TA) ratification within countries. TA ratification is inherently uncertain in each country, where anti- and pro-trade interest groups contest each other to influence their own governments' ratification decision. Unlike prior literature, the protection embodied in negotiated TA tariffs reflects a balance between the liberalizing force of lobbying and inherently protectionist government preferences. Moreover, new international political externalities emerge that are not internalized by governments that just internalize terms of trade externalities.

Suggested Citation

  • Matthew T. Cole & James Lake & Ben Zissimos, 2018. "Contesting an international trade agreement," Departmental Working Papers 1805, Southern Methodist University, Department of Economics.
  • Handle: RePEc:smu:ecowpa:1805
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    Cited by:

    1. Michael Blanga-Gubbay & Paola Conconi & Mathieu Parenti, 2020. "Globalization for Sale," CESifo Working Paper Series 8239, CESifo.
    2. Yuting Gao, 2022. "Lobbying for Trade Liberalization and its Policy Influence," CAEPR Working Papers 2022-006 Classification-D, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
    3. Cole, Matthew T. & Lake, James & Zissimos, Ben, 2021. "Contesting an international trade agreement," Journal of International Economics, Elsevier, vol. 128(C).
    4. Appelbaum, Elie & Melatos, Mark, 2021. "Preferential Trade Agreements as Insurance," Working Papers 2021-04, University of Sydney, School of Economics.
    5. James Lake & Jun Nie, 2022. "The 2020 US Presidential Election and Trump's Trade War," CESifo Working Paper Series 9669, CESifo.

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    More about this item

    Keywords

    Trade Agreement; ratification; tariff; contest; lobbying; contribution; externalities;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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