Citation

Discussion Paper Details

Please find the details for DP1039 in an easy to copy and paste format below:

Full Details   |   Bibliographic Reference

Full Details

Title: What does the Political Economy Literature on Trade Policy (Not) Tell Us That We Ought to Know?

Author(s): Dani Rodrik

Publication Date: October 1994

Keyword(s): Political Economy and Trade Policy

Programme Area(s): International Trade and Regional Economics

Abstract: Three questions lie at the core of the large and distinguished literature on the political economy of trade policy. First, why is international trade not free? Second, why are trade policies universally biased against (rather than in favour of) trade? Third, what are the determinants of the variation in protection levels across industries, countries, and institutional contexts? These questions are handled only imperfectly by the existing literature. Current models treat trade policy as a redistributive tool, but do not explain why it emerges in political equilibrium in preference over more direct policy instruments. Further, existing models do not generate a bias against trade, implying that pro-trade interventions are as likely as trade-restricting interventions. The greatest contribution of the political economy literature may lie in developing a better grasp of normative economic analysis - that is, in helping design policies, rules, and institutions.

For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=1039

Bibliographic Reference

Rodrik, D. 1994. 'What does the Political Economy Literature on Trade Policy (Not) Tell Us That We Ought to Know?'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=1039