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Trade Policy in Majoritarian Systems: The Case of the U.S

Author

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  • Per G. Fredriksson
  • Xenia Matschke
  • Jenny Minier

Abstract

We provide a theory of trade policy determination that incorporates the protectionist bias inherent in majoritarian systems, suggested by Grossman and Helpman (2005). The prediction that emerges is that in majoritarian systems, the majority party favors industries located disproportionately in majority districts. We test this prediction using U.S. data on tariffs, Congressional campaign contributions, and industry location in districts represented by the majority party over the period 1989-97. We find evidence of a significant majority bias in trade policy: the benefit to being represented by the majority party appears at least as large in magnitude as the benefit to lobbying.

Suggested Citation

  • Per G. Fredriksson & Xenia Matschke & Jenny Minier, 2011. "Trade Policy in Majoritarian Systems: The Case of the U.S," Research Papers in Economics 2011-01, University of Trier, Department of Economics.
    • Handle: RePEc:trr:wpaper:201101
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    Cited by:

    1. Giacomo A. M. Ponzetto & Maria Petrova & Ruben Enikolopov, 2008. "The Dracula effect: voter information and trade policy," Economics Working Papers 1296, Department of Economics and Business, Universitat Pompeu Fabra, revised Oct 2020.
    2. Lake, James, 2015. "Revisiting the link between PAC contributions and lobbying expenditures," European Journal of Political Economy, Elsevier, vol. 37(C), pages 86-101.
    3. Adina Ardelean & Carolyn L. Evans, 2013. "Electoral systems and protectionism: an industry‐level analysis," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 46(2), pages 725-764, May.
    4. Celik, Levent & Karabay, Bilgehan & McLaren, John, 2013. "Trade policy-making in a model of legislative bargaining," Journal of International Economics, Elsevier, vol. 91(2), pages 179-190.
    5. Xiangjun Ma & John McLaren, 2018. "A Swing-State Theorem, with Evidence," NBER Working Papers 24425, National Bureau of Economic Research, Inc.
    6. Kagitani, Koichi & Harimaya, Kozo, 2017. "Electoral motives, constituency systems, ideologies, and a free trade agreement: The case of Japan joining the Trans-Pacific Partnership negotiations," Journal of the Japanese and International Economies, Elsevier, vol. 45(C), pages 51-66.

    More about this item

    Keywords

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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