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“Politically Motivated Trade Protection” (with Chad Bown, Aksel Erbahar, and Lorenzo Trimarchi)
The Electoral College system used to elect US presidents has been widely criticized
and many proposals have been put forward to reform it or even abolish it. This paper
shows that this system distorts US trade policies in favor of key industries in swing
states, at the expense of other industries. We focus on antidumping (AD) duties, the
most widely used protectionist barrier. We first show that, during executive first terms,
when the president can be re-elected, the level of AD protection granted to an industry
depends on its importance in swing states. We then exploit exogenous variation in the
identity of swing states across electoral terms to construct an instrument for AD duties
and study their effects along supply chains. We find that politically motivated trade
protection fosters growth in key input industries by decreasing imports and increasing
prices, but hampers growth in downstream industries by raising production costs.
Date:
15 November 2023, 11:00
Venue:
Manor Road Building, Manor Road OX1 3UQ
Venue Details:
Seminar Room A
Speaker:
Paola Conconi (University of Oxford)
Organising department:
Department of Economics
Part of:
Political Economy Seminar
Booking required?:
Not required
Audience:
Members of the University only
Editor:
Shreyasi Banerjee
