Labor versus capital in trade-policy determination: the role of general-interest and special-interest politics
In: NBER working paper series 10084
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In: NBER working paper series 10084
In: NBER working paper series 9239
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Working paper
In: The Canadian journal of economics: the journal of the Canadian Economics Association = Revue canadienne d'économique, Band 42, Heft 1, S. 155-183
ISSN: 1540-5982
AbstractWe examine whether protectionist trade policies lead to increased bureaucratic corruption. Using multiple measures of corruption and trade policies, we find strong evidence that corruption is significantly higher in countries with protectionist trade policies. These results are robust to endogeneity concerns. Next, a panel‐data‐based GMM methodology is used to estimate a dynamic model of corruption. This estimator controls for country‐specific effects, potential endogeneity of trade policy, and existence of measurement errors afflicting the corruption data. The paper strengthens the case for trade liberalization and argues that trade reforms may lead to improvements in governance.
In: Canadian Journal of Economics/Revue canadienne d'économique, Band 42, Heft 1, S. 155-183
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Working paper
In: Economics & politics, Band 33, Heft 1, S. 1-36
ISSN: 1468-0343
AbstractWe draw upon recent advances that combine causal inferences with machine learning, to show that poverty is the key income distribution measure that matters for development outcomes. In a predictive framework, we first show that LASSO chooses only the headcount measure of poverty from 37 income distribution measures in predicting schooling, institutional quality, and per capita income. Next, causal inferences with post‐LASSO models indicate that poverty matters more strongly for development outcomes than does the Gini coefficient. Finally, instrumental variable estimates in conjunction with post‐LASSO models show that compared to Gini, poverty is more strongly causally associated with schooling and per capita income, but not institutional quality. Our results question the literature's overwhelming focus on the Gini coefficient. At the least, our results imply that the causal link from inequality (as measured by Gini) to development outcomes is tenuous.
In: INSEAD Working Paper No. 2019/39/EPS/DSC
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Working paper
In: World Scientific Studies in International Economics; The Political Economy of Trade Policy, S. 95-108
In: World Scientific Studies in International Economics; The Political Economy of Trade Policy, S. 67-93
In: World Scientific Studies in International Economics; The Political Economy of Trade Policy, S. 109-119
In: World Scientific Studies in International Economics; The Political Economy of Trade Policy, S. 121-146
In: The Canadian journal of economics: the journal of the Canadian Economics Association = Revue canadienne d'économique, Band 43, Heft 4, S. 1198-1220
ISSN: 1540-5982
Abstract We examine whether increased trade with countries with ineffective protection of intellectual property has contributed to the skill‐deepening of the 1980s. We construct an index of effective protection of intellectual property at the country level, combining data on protection of patents and rule of law. Next, we construct an industry‐specific version of this index, using as weights each country's trade share in the total trade of the industry. We find a decline in this trade‐weighted index, owing to a rise in trade with countries with low effective protection of intellectual property, which explains 29% of the rise in within‐industry skill‐intensity.
In: Canadian Journal of Economics/Revue canadienne d'économique, Band 43, Heft 4, S. 1198-1220
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In this paper, the authors examine the political economy drivers of the variation in agricultural protection, both across countries and within countries over time. The paper starts by listing the key insights provided by both the theoretical and empirical literature on the political economy of trade policy formulation. The authors then set out a basic framework that allows us to put forth various testable hypotheses on the variation and evolution of agricultural protection. The authors find that both the political ideology of the government and the degree of income inequality are important determinants of agricultural protection. Thus, both the political-support-function approach as well as the median-voter approach can be used in explaining the variation in agricultural protection across countries and within countries over time. The results are consistent with the predictions of a model that assumes that labor is specialized and sector-specific in nature. Some aspects of protection also seem to be consistent with predictions of a lobbying model in that agricultural protection is negatively related to agricultural employment and positively related to agricultural productivity. Public finance aspects of protection also seem to be empirically important.
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