Hostname: page-component-78c5997874-8bhkd Total loading time: 0 Render date: 2024-11-08T06:24:48.315Z Has data issue: false hasContentIssue false
  • English
  • Français

Lobbying and Agricultural Trade Policy in the United States

Published online by Cambridge University Press:  09 August 2006

Kishore Gawande  and
Bernard Hoekman
Kishore Gawande
Affiliation:
Bush School of Government, Texas A&M University, College Station, [email protected]
Bernard Hoekman
Affiliation:
International Trade Group at the World Bank, Washington, D.C., and the Centre for Economic Policy Research (CEPR), London, [email protected]
Get access

Abstract

This article studies whether political campaign contributions influence agricultural protection in the United States in the manner suggested by the political economy model of Grossman and Helpman (1994). This is the first attempt to test this model using agricultural data. We test the model using a detailed cross-sectional data set of agricultural protection, subsidies, and PAC contributions in the late 1990s. The model is qualitatively affirmed by the data. We make a novel attempt to solve a puzzle about the model's quantitative implications, also found in recent studies. This solution makes the simple model consistent with the complicated decision-making process in real-world government. The results imply the underpinnings of a political economy equilibrium that will be hard to dislodge.This article has benefited greatly from the insightful comments of the editor and two anonymous referees. We thank Marcelo Olarreaga for access to valuable data on agricultural protection and subsidies. We accept responsibility for any remaining errors. The views expressed are our own and should not be attributed to the World Bank.

Type
Research Article
Information
International Organization , Volume 60 , Issue 3 , July 2006 , pp. 527 - 561
Copyright
© 2006 The IO Foundation and Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Anderson, Kym. 1992. International Dimensions of the Political Economy of Distortionary Price and Trade Policies. In Open Economies: Structural Adjustment and Agriculture, edited by Ian Goldin and L. Alan Winters, 290–310. Cambridge: Cambridge University Press.
Anderson, Kym, and Yujiro Hayami. 1986. The Political Economy of Agricultural Protection. Sydney, Australia: Allen and Unwin.
Bauer, Raymond, Ithiel de Sola Pool, and Lewis Dexter. 1963. American Business and Public Policy. New York: Atherton.
Beaulieu, Eugene, and Chris Magee. 2004. Four Simple Tests of Campaign Contributions and Trade Policy Preferences. Economics & Politics 16 (2):163–87.CrossRefGoogle Scholar
Brooks, Jonathan C., A. Colin Cameron, and Colin A. Carter. 1998. Political Action Committee Contributions and U.S. Congressional Voting on Sugar Legislation. American Journal of Agricultural Economics 80 (3):441–54.CrossRefGoogle Scholar
Congressional Quarterly. 1994. Politics in America: 1994, the 103rd Congress. Washington, D.C.: CQ Press.
Congressional Quarterly. 1995. Politics in America: 1996, the 104th Congress. Washington, D.C.: CQ Press.
Congressional Quarterly. 1997. Politics in America: 1998, the 105th Congress. Washington, D.C.: CQ Press.
Congressional Quarterly. 1999. Politics in America: 2000, the 106th Congress. Washington, D.C.: CQ Press.
Cox, Gary W., and Mathew D. McCubbins. 2001. The Institutional Determinants of Economic Policy Outcomes. In Presidents, Parliaments, and Policy, edited by S. Haggard and M. D. McCubbins, 27–89. Cambridge: Cambridge University Press.
de Gorter, H., and Johan F. M. Swinnen. 2002. Political Economy of Agricultural Policies. In Handbook of Agricultural Economics, edited by Bruce L. Gardner and Gordon C. Rausser, 1893–943. New York: Elsevier.
de Gorter, H., and Y. Tsur. 1991. Explaining Price Policy Bias in Agriculture. American Journal of Agricultural Economics 73 (4):1244–54.CrossRefGoogle Scholar
de Melo, Jaime, and David Tarr. 1990. Welfare Costs of U.S. Quotas in Textiles, Steel and Autos. Review of Economics and Statistics 72 (3):489–97.CrossRefGoogle Scholar
Eicher, Theo, and Thomas Osang. 2002. Protection for Sale: An Empirical Investigation: Comment. American Economic Review 92 (5):1702–10.CrossRefGoogle Scholar
Fenno, Richard E. 1973. Congressmen in Committees. Boston: Little, Brown.
Friedman, Lee S., 2003. Wither, or Whither, Agricultural Crop Subsidies? Keynote luncheon address, American Agricultural Economics Association, Montreal, Canada.
Fuller, Wayne. 1986. Measurement Error Models. New York: Wiley.
Gardner, Bruce L. 1987. Causes of U.S. Farm Commodity Programs. Journal of Political Economy 95 (2):290–310.CrossRefGoogle Scholar
Gawande, Kishore. 2006. The Structure of Lobbying and Protection in U.S. Agriculture. In Economic Development and Multilateral Trade Cooperation, edited by Bernard Hoekman and Simon Evenett. New York: Macmillan/Palgrave.
Gawande, Kishore, and Usree Bandyopadhyay. 2000. Is Protection for Sale? A Test of the Grossman-Helpman Theory of Endogenous Protection. Review of Economics and Statistics 82 (1):139–52.CrossRefGoogle Scholar
Gawande, Kishore, and Pravin Krishna. 2003. The Political Economy of Trade Policy: Empirical Approaches. In Handbook of International Trade, edited by James Harrigan and E. Kwan Choi, 213–50. Malden, Mass.: Blackwell.
Goldberg, Pinelopi, and Giovanni Maggi. 1999. Protection for Sale: An Empirical Investigation. American Economic Review 89 (5):1135–55.CrossRefGoogle Scholar
Goldstein, Judith. 1989. The Impact of Ideas on Trade Policy: The origins of U.S. Agricultural and Manufacturing Policies. International Organization 43 (1):31–71.CrossRefGoogle Scholar
Grier, Kevin B., and M. C. Munger. 1991. Committee Assignments, Constituent Preferences, and Campaign Contributions. Economic Inquiry 29 (1):24–43.CrossRefGoogle Scholar
Grossman, Gene, and Elhanan Helpman. 1994. Protection for Sale. American Economic Review 84 (4):833–50.Google Scholar
Grossman, Gene, and Elhanan Helpman. 2002. Interest Groups and Trade Policy. Princeton, N.J.: Princeton University Press.
Hansen, John M. 1991. Gaining Access: Congress and the Farm Lobby, 1919–81. Chicago: University of Chicago Press.
Hiscox, Michael. 1999. The Magic Bullet? The RTAA, Institutional Reform and Trade Liberalization. International Organization 53 (4):669–98.CrossRefGoogle Scholar
Hoekman, Bernard, and Michel Kostecki. 1996. The Political Economy of the World Trading System: From GATT to WTO. Oxford: Oxford University Press.
Hoekman, Bernard, Francis Ng, and Marcelo Olarreaga. 2004. Agricultural Tariffs or Subsidies: Which Are More Important for Developing Countries? World Bank Economic Review 18 (2):175–204.Google Scholar
Honma, Masayoshi. 1993. Japan's Agricultural Policy and Protection Growth. In Trade and Protectionism, edited by T. Ito and Anne O. Krueger, 95–114. Chicago: University of Chicago Press.
Hufbauer, Gary C., Diane T. Berliner, and Kimberly A. Elliott. 1986. Trade Protection in the United States: 31 Case Studies. Washington, D.C.: Institute of International Economics.
Kee, Hiau Looi, Alessandro Nicita, and Marcelo Olarreaga. 2004a. Import Demand Elasticities and Trade Distortions. Working Paper 4669, Centre for Economic Policy Research, London.
Kee, Hiau Looi, Alessandro Nicita, and Marcelo Olarreaga. 2004b. Ad-Valorem Equivalents of Non-Tariff Barriers. Mimeo. Washington, D.C.: World Bank.
Kelejian, Harry H. 1971. Two Stage Least Squares and Econometric Systems Linear in Parameters But Non-Linear in the Endogenous Variables. Journal of the American Statistical Association 66:373–74.CrossRefGoogle Scholar
Kohli, Ulrich. 1991. Technology, Duality and Foreign Trade: The GNP Function Approach to Modeling Imports and Exports. Ann Arbor: University of Michigan Press.
Leamer, Edward. 1990. Latin America as a Target of Trade Barriers Erected by the Major Developed Countries in 1983, Journal of Development Economics 32 (2):337–68.Google Scholar
Lopez, Rigoberto. 2001. Campaign Contributions and Agricultural Subsidies. Economics and Politics 13 (3):257–79.CrossRefGoogle Scholar
Martin, Lisa L. 1992. Interests, Power, and Multilateralism. International Organization 46 (4):765–92.CrossRefGoogle Scholar
Martin, Lisa L., and Beth A. Simmons. 1998. Theories and Empirical Studies of International Institutions. International Organization 52 (4):729–57.CrossRefGoogle Scholar
McCalman, Philip. 2004. Protection for Sale and Trade Liberalization: An Empirical Investigation. Review of International Economics 12 (1):81–94.CrossRefGoogle Scholar
Milbraith, Lester W. 1960. The Washington Lobbyists. Chicago: Rand-McNally.
Mitra, Devashish, Dimitrios D. Thomakos, and Mehmet A. Ulubasoglu. 2002. Protection for Sale in a Developing Country: Democracy Versus Dictatorship. Review of Economics and Statistics 84 (3):497–508.CrossRefGoogle Scholar
Olper, Alessandro. 1998. Political Economy Determinants of Agricultural Protection Levels in EU Member States: An Empirical Investigation. European Review of Agricultural Economics 25 (4):463–87.CrossRefGoogle Scholar
Olson, Mancur. 1965. The Logic of Collective Action. Cambridge, Mass.: Harvard University Press.
Paarlberg, Robert. 1997. Agricultural Policy Reform and the Uruguay Round: Synergistic Linkage in a Two-Level Game? International Organization 51 (3):413–44.Google Scholar
Parker, Glenn R., and Suzanne L. Parker. 1998. The Economic Organization of Legislatures and How It Affects Congressional Voting. Public Choice 95 (1–2):117–29.Google Scholar
Peltzman, Sam. 1976. Toward a More General Theory of Regulation. Journal of Law and Economics 19 (2):211–40.CrossRefGoogle Scholar
Staiger, Douglas, and James H. Stock. 1997. Instrumental Variables Regression with Weak Instruments. Econometrica 65 (3):557–86.CrossRefGoogle Scholar
Stigler, George J. 1971. The Theory of Economic Regulation. Bell Journal of Economics and Management Science 2 (1):3–21.CrossRefGoogle Scholar
Stock, James H., and Motohiro Yogo. 2005. Testing for Weak Instruments in Linear IV Regression. In Identification and Inference for Econometric Models: Essays in Honor of Thomas J. Rothenberg, edited by D. W. K. Andrews and J. H. Stock, 80–108. Cambridge: Cambridge University Press.
Stratmann, Thomas. 1992. The Effects of Logrolling on Congressional Voting. American Economic Review 82 (5):1162–76.Google Scholar
Stratmann, Thomas. 1995. Logrolling in the U.S. Congress. Economic Inquiry 33 (3):441–56.CrossRefGoogle Scholar
Tsebelis, George. 2002. Veto Players: How Political Institutions Work. Princeton, N.J.: Princeton University Press.
Vousden, Neil. 1990. The Economics of Trade Protection. Cambridge: Cambridge University Press.
Weingast, B. R., and W. J. Marshall. 1988. The Industrial Organization of Congress; or Why Legislatures, Like Firms, Are Not Organized as Markets. Journal of Political Economy 96 (1):132–63.CrossRefGoogle Scholar
Wright, John. 1990. Contributions, Lobbying, and Committee Voting in the U.S. House of Representatives. American Political Science Review 84 (2):417–38.CrossRefGoogle Scholar
Yarbrough, Beth, and Robert Yarbrough. 1992. Cooperation and Governance in International Trade. Princeton, N.J.: Princeton University Press.
U.S. Department of Agriculture. 2002. Production, Supply and Distribution database. Available at 〈http://www.ers.usda.gov〉. Accessed 15 March 2006.
United Nations Conference on Trade and Development (UNCTAD). 2000. TRAINS Database. New York: UNCTAD.