Hostname: page-component-78c5997874-s2hrs Total loading time: 0 Render date: 2024-11-02T21:30:17.915Z Has data issue: false hasContentIssue false
  • English
  • Français

The Deep Roots of Protectionism in the Southern Cone: Constituent Interests and Mercosur’s Common External Tariff

Published online by Cambridge University Press:  22 October 2018

Anthony A. Pezzola
Anthony A. Pezzola*
Affiliation:
Director of overseas programs atWashington University in St. Louis.
*
[email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

This article examines the influence of subnational economic interests on the formation of supranational trade policy in the Southern Common Market (Mercosur). Accounting for differences in the relative importance of member countries, the article argues that subnational economic interests influenced the structure of Mercosur’s common external tariff (CET). Although the CET was negotiated without direct input from voters or legislators, its structure reflects the interests of geographically specific economic interests in the member countries. The results of a regression analysis of tariffs toward nonmembers indicate that the economic composition of subnational political jurisdictions shaped the structure of the CET. These findings suggest that by overlooking subnational economic interests, much of the current literature on the evolution of Mercosur misses a critical aspect of the policymaking process.

Keywords

Mercosurprotectionismintegrationconstituent interestsfederalism
Type
Research Article
Information
Latin American Politics and Society , Volume 60 , Issue 4 , November 2018 , pp. 69 - 92
Copyright
© 2018 University of Miami 

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

Data Sources

Trade Data: United Nations Conference on Trade and Development Trade Analysis Information System. http://unctad.org/en/Pages/DITC/Trade-Analysis/Non-Tariff-Measures/NTMs-trains.aspx. Accessed June 10, 2014.Google Scholar
Tariff Data: World Integrated Trade Solution (WITS) http://wits.worldbank.org. Accessed June 10, 2014.Google Scholar
Production Data: Argentina. Instituto Nacional de Estadística y Censos. 1994. Censo Nacional Económico 1994. Buenos Aires: Government of Argentina.Google Scholar
Brazil. Instituto Brasileiro de Geografia e Estatística. 1994. Pesquisa Industrial Annual: 1993. Brasília: Government of Brazil.Google Scholar
Paraguay. Dirección General de Estadística, Encuesta y Censos. 2001. Cuadro 342-07. Producto Interno Bruto a Precios de Mercado. Asunción: Government of Paraguay. http://www.dgeec.gov.py/microdatos/index.php. Accessed June 10, 2014.Google Scholar
Uruguay. Instituto Nacional de Estadística. 1990. III censo económico nacional. Montevideo: Goverment of Uruguay.Google Scholar

References

Alston, Lee J., and Mueller, Bernardo. 2005. Pork for Policy: Executive and Legislative Exchange in Brazil. Journal of Law, Economics, and Organization 22: 87–114.Google Scholar
Ames, Barry. 1995. Electoral Rules, Constituency Pressures, and Pork Barrel: Bases of Voting in the Brazilian Congress. Journal of Politics 57: 324–343.Google Scholar
Ansolabehere, Stephen, Leblanc, William, and Snyder, James M.. 2012. When Parties Are Not Teams. Economic Theory 49: 521–547.Google Scholar
Arce, Hugh, Koopman, Robert B., and Tsigas, Marinos. 2008. Using State-Level Simulations in a Political Economy Model of U.S. Trade Policy. Public Choice 135: 91–107.Google Scholar
Bailey, Michael. 2001. Quiet Influence: The Representation of Diffuse Interests on Trade Policy, 1983–94. Legislative Studies Quarterly 26, 1: 45–80.Google Scholar
Baldwin, Robert. 1985. The Political Economy of U.S. Import Policy. Cambridge: MIT Press.Google Scholar
Baldwin, Robert. 1991. The Political-Economy Perspective on Trade Policy. In Markets and Politicians: Politicized Economic Choice, ed. Arye L. Hillman. Boston: Kluwer. 263–282.Google Scholar
Bandyopadhyay, Subhayu, Lahiri, Sajal, and Roy, Suryadipta. 2011. Political Asymmetry and Common External Tariff in a Customs Union. Economics and Politics 23: 88–106.Google Scholar
Bianculli, Andrea, and Botto, Mercedes. 2009. The Case of Argentine Research in the Building of Regional Integration. In The Politics of Trade: The Role of Research in Trade Policy and Negotiation, ed. Diana Tussie. Leiden: Brill. 83–120.Google Scholar
Blonigen, Bruce A. 2011. Revisiting the Evidence on Trade Policy Preferences. Journal of International Economics 85: 129–135.Google Scholar
Bombardini, Matilde, and Trebbi, Francesco. 2012. Competition and Political Organization. Journal of International Economics 87: 18–26.Google Scholar
Borges, André. 2011. The Political Consequences of Center-Led Redistribution in Brazilian Federalism. Latin American Research Review 46: 21–45.Google Scholar
Borges, André, and Lloyd, Ryan. 2016. Presidential Coattails and Electoral Coordination in Multilevel Elections. Electoral Studies 43: 104–114.Google Scholar
Botafogo, José. 2004. Ambassador to Mercosur 2000–2002; Ambassador to Argentina 2002–4, President of the Brazilian Center for International Relations. Author interview. Rio de Janeiro, September 14.Google Scholar
Botto, Mercedes, and Quiliconi, Cintia. 2010. The Influence of Academia on Mercosur’s Tariff Policy. In Research and International Trade Policy Negotiations: Knowledge and Power in Latin America, ed. Botto. New York: Routledge. 163–194.Google Scholar
Busch, Marc, and Reinhardt, Eric. 1999. Industrial Location and Protection: The Political and Economic Geography of U.S. Nontariff Barriers. Journal of Political Science 43: 1028–1050.Google Scholar
Busch, Marc, and Reinhardt, Eric. 2000. Geography, International Trade, and Political Mobilization in U.S. Industries. American Journal of Political Science 44: 703–719.Google Scholar
Cadot, Olivier, De Melo, Jaime, and Olarreaga, Marcelo. 1996. Regional Integration and Lobbying for Tariffs Against Non-Members. CEPR Discussion Paper 1448. London: Centre for Economic Policy Research.Google Scholar
Calfat, Germán, Flores, Renato Jr., and Ganame, María Cecilia. 2000. Endogenous Protection in Mercosul: An Empirical Analysis. Working Paper 2000025. Faculty of Applied Economics, University of Antwerp.Google Scholar
Calvo, Ernesto. 2014. Legislator Success in Fragmented Congresses in Argentina. Cambridge: Cambridge University Press.Google Scholar
Calvo, Ernesto, and Escolar, Marcelo. 2005. La nueva política de partidos en la Argentina. Buenos Aires: Fundación PENT/Prometeo.Google Scholar
Calvo, Ernesto, and Leiras, Marcelo. 2012. The Nationalization of Legilsative Collaboration. Revista Ibero-Americana de Estudios Legislativos 2: 2–19.Google Scholar
Carranza, Mario E. 2003. Can Mercosur Survive? Domestic and International Constraints on Mercosur. Latin American Politics and Society 45, 2: 67–103.Google Scholar
Caves, Richard E. 1976. Economic Models of Policy Choice in Canada’s Tariff Structure. Canadian Journal of Economics 9: 279–300.Google Scholar
Da Conceição-Heldt, Eugénia. 2013. The Domestic Sources of Multilateral Trade Negotiations. International Trade Journal 27: 173–194.Google Scholar
De Castro Neves, João Augusto. 2003. O papel do legislativo nas negociações do Mercosul e da Alca. Contexto Internacional 25: 103–138.Google Scholar
Eaton, Kent. 2001. Political Obstacles to Decentralization: Evidence from Argentina and the Philippines. Development and Change 32: 101–127.Google Scholar
Eaton, Kent. 2002. Politicians and Economic Reform in New Democracies: Argentina and the Philippines in the 1990s. University Park: Pennsylvania State University Press.Google Scholar
Ehrlich, Sean. 2009. How Common Is the Common External Tariff? European Union Politics 10: 115–141.Google Scholar
Finger, J. Michael, and Harrison, Ann. 1994. The MFA Paradox: More Protection and More Trade? NBER Working Paper no. 4751. Cambridge, MA: National Bureau of Economic Research, May.Google Scholar
Flecha de Lima, Paulo. 2004. Director of the Commercial Department, Brazilian Foreign Ministry, 1971–83; Subsecretary of the Foreign Ministry for Economic and Commercial Issues, 1985–90. Author interview. Brasília, June 10.Google Scholar
Fordham, Benjamin, and McKeown, Timothy. 2003. Selection and Influence: Interest Groups and Congressional Voting on Trade Policy. International Organization 57: 519–549.Google Scholar
Gardini, Gian Luca. 2010. The Origins of Mercosur: Democracy and Regionalization in South America. New York: Palgrave Macmillan.Google Scholar
Gibson, Edward. 1997. The Populist Road to Market Reform: Policy and Electoral Coalitions in Mexico and Argentina. World Politics 49: 339–370.Google Scholar
Gibson, Edward., and Suárez-Cao, Julieta. 2010. Federalized Party Systems and Subnational Party Competition. Comparative Politics 43: 21–39.Google Scholar
Gilligan, Michael. 1997. Lobbying as a Private Good with Intra-Industry Trade. International Studies Quarterly 41: 455–471.Google Scholar
Gilligan, Thomas W., and Krehbiel, Keith. 1987. Collective Decisionmaking and Standing Committees. Journal of Law, Economics, and Organization 3: 287–335.Google Scholar
Gómez-Mera, Laura. 2009. Domestic Constraints on Regional Cooperation. Review of International Political Economy 16: 746–777.Google Scholar
Gómez-Mera, Laura. 2013. Power and Regionalism in Latin America: The Politics of MERCOSUR. Notre Dame: University of Notre Dame Press.Google Scholar
González, Lucas, and Mamone, Miguel. 2015. Who Distributes? Presidents, Congress, Governors, and the Politics of Distribution in Argentina and Brazil. Revista Ibero-Americana de Estudos Legislativos 4: 17–32.Google Scholar
Goodhart, Lucy. 2014. Protection as Targeting: Why Governments Protect Declining Industries. Paper prepared for the Annual Meeting of the European Political Science Association, Edinburgh, Scotland, June 21–23.Google Scholar
Grossman, Gene M., and Helpman, Elhanan. 1994. Protection for Sale. American Economic Review 84: 833–850.Google Scholar
Grossman, Gene M., and Helpman, Elhanan. 1995. The Politics of Free-Trade Agreements. American Economic Review 85: 667–690.Google Scholar
Hirst, Monica. 1996. La dimensión política del Mercosur: actores, politización y ideologia. Estudos Avançados 10: 217–250.Google Scholar
Hirst, Monica, Bezchinsk, Gabriel, and Castellana, Fabian. 1994. A reação do empresariado argentino diante da formação do Mercosur. IPEA texto para discussão 0337. Brasília: Instituto de Pesquisa Econômica Aplicada, May.Google Scholar
Hummel, Felix, and Lohaus, Mathis. 2012. Mercosur: Integration Through Presidents and Paymasters. In Roads to Regionalism: Genesis, Design, and Effects of Regional Organizations, ed. Tanja A. Börzel et al. Burlington: Ashgate. 77–96.Google Scholar
Jones, Mark, Saiegh, Sebastian, Spiller, Pablo T., and Tommasi, Mariano. 2002. Amateur Legislators, Professional Politicians. American Journal of Political Science 46: 656–669.Google Scholar
Kaltenthaler, Karl, and Mora, Frank. 2002. Explaining Latin American Economic Integration. Review of International Political Economy 9: 72–97.Google Scholar
Kee, Hiau Looi, Nicita, Alessandro, and Olarreaga, Marcelo. 2008. Import Demand Elasticities and Trade Distortions. Review of Economics and Statistics 90: 666–682.Google Scholar
Lee, Jong-Wha, and Swagel, Phillip. 1997. Trade Barriers and Trade Flows Across Countries and Industries. Review of Economics and Statistics 79: 372–382.Google Scholar
Levy, Philip. 1997. A Political-Economic Analysis of Free-Trade Agreements. American Economic Review 87: 506–519.Google Scholar
Lodola, Germán. 2010. The Politics of Subnational Coalition Building: Gubernatorial Redistributive Strategies in Argentina and Brazil. Ph.D. diss., University of Pittsburgh.Google Scholar
Lyne, Mona. 2008. Proffering Pork: How Party Leaders Build Party Reputations in Brazil. American Journal of Political Science 52: 290–303.Google Scholar
Lyne, Mona. 2015. Rethinking the Political Economy of Import Substitution Industrialization in Brazil: A Clientelist Model of Development Policymaking. Latin American Politics and Society 57, 1: 75–98.Google Scholar
Madeira, Mary Anne. 2013. The New Politics of the New Trade: The Political Economy of Intra-Industry Trade. Ph.D. diss., University of Washington.Google Scholar
Magaloni, Beatriz, Díaz-Cayeros, Alberto, and Estevez, Federico. 2007. Clientelism and Portfolio Diversification. In Patrons, Clients, and Policies: Patterns of Democratic Accountability and Political Competition, ed. Herbert Kitschelt and Steven Wilkinson. New York: Cambridge University Press. 182–205.Google Scholar
Magee, Stephen P., Brock, William A., and Young, Leslie. 1989. Black Hole Tariffs and Endogenous Policy Theory: Political Economy in General Equilibrium. New York: Cambridge University Press.Google Scholar
Mainwaring, Scott. 1991. Politicians, Parties, and Electoral Systems: Brazil in Comparative Perspective. Comparative Politics 24: 21–43.Google Scholar
Makuc, Adrían. 2004. Member of the Mercosur negotiation team, Ministry of Economy, 1995–97; Commerical Policy Director, Ministry of Economy, 1998–2004. Author interview. Buenos Aires, Febuary 20.Google Scholar
Malamud, Andrés. 2005. Presidential Diplomacy and the Institutional Underpinnings of Mercosur. Latin American Research Review 40: 138–164.Google Scholar
Malamud, Andrés. 2013. Overlapping Regionalism, No Integration: Conceptual Issues and the Latin American Experiences. Working Paper RSCAS 2013/20. European University Institute. http://hdl.handle.net/1814/26336Google Scholar
Martin, Lisa. 2000. Democratic Commitments: Legislatures and International Cooperation. Princeton: Princeton University Press.Google Scholar
Mayoral, Alejandro. 2004. Subsecretario de Política Económica, 1991–96, 1996–98. Author phone interview. Buenos Aires, March 25.Google Scholar
McGillivray, Fiona. 1997. Party Discipline as a Determinate of Endogenous Formation of Tariffs. American Journal of Political Science 41: 584–607.Google Scholar
Milner, Helen. 1988. Resisting Protectionism: Global Industries and the Politics of International Trade. Princeton: Princeton University Press.Google Scholar
Milner, Helen, and Rosendorff, B. Peter. 1996. Trade Negotiations, Information and Domestic Politics. Politics and Economics 8: 145–189.Google Scholar
Moore, Ryan, Powell, Eleanor Neff, and Reeves, Andrew. 2013. Driving Support: Workers, Pacs, and Congressional Support of the Auto Industry. Business and Politics 15: 137–162.Google Scholar
Murillo, María Victoria, and Pinto, Pablo. 2014. Heeding to the Losers? Legislators’ Trade Policy Preferences and Behavior in the Spotlight. Paper presented at the 1st annual meeting of the Red para el Estudio de la Economía Política de América Latina, Santiago, Chile, June 9–10.Google Scholar
Ochoa, Raúl. 2004. Negotiator, Common Market Group, 1990; Subsecratary of Trade, Ministry of Economy, 1990–91; Asesor de la Presidencia de la Comisión de Industria de la Cámara de Diputados, 1995–98. Author interview. Buenos Aires, March 25.Google Scholar
Olarreaga, Marcelo, Soloaga, Isidro, and Winters, Alan. 1999. What’s Behind Mercosur’s Common External Tariff? Policy Research Working Paper WPS2231, November 30. Washington, DC: World Bank.Google Scholar
Panagariya, Arvid, and Findal, Ronald. 1996. A Political Economy Analysis of Free-Trade Areas and Customs Unions. In The Political Economy of Trade Policy: Papers in Honor of Jagdish Bhagwati, ed. Robert C. Feenstra, Gene M. Grossman, and Douglas A. Irwin. Cambridge: MIT Press. 147–175.Google Scholar
Pezzola, Anthony. 2013. States in the Customs House: Institutional Reforms and Structural Change in Mexican Trade Policy. International Studies Quarterly 57: 341–355.Google Scholar
Pezzola, Anthony. 2017. Cooperación diacrónica para intereses diversos. Política y Gobierno 24: 125–156.Google Scholar
Putnam, Robert. 1988. Diplomacy and Domestic Politics: The Logic of Two-Level Games. International Organization 42: 427–460.Google Scholar
Ribeiro, Pedro. 2013. Organização e poder nos partidos brasileiros: uma análise dos estatutos. Revista Brasileira de Ciência Política 10: 225–265.Google Scholar
Saggi, Kamal. 2006. Preferential Trade Agreements and Multilateral Tariff Cooperation. International Economic Review 47: 29–57.Google Scholar
Samuels, David. 2003. Ambassadors of the States: Political Ambition, Federalism, and Congressional Politics in Brazil. Cambridge: Cambridge University Press.Google Scholar
Santana, Helton Reginaldo Presto. 2001. Grupos de interesse e a política externa brasileira para a ALCA. Contexto Internacional 23: 167–196.Google Scholar
Santos, Fabiano. 2003. O poder legislativo nos estados: diversidade e convergência. Rio de Janiero: Fundação Getúlio Vargas.Google Scholar
Sarney, José. 2004. President of Brazil, 1986–90; Senator, Amapá, 1990–2015; President of the Senate, 1995–97, 2003–5, 2009–13. Author interview. Brasília, July 8.Google Scholar
Schattschneider, Elmer. 1935. Politics, Pressures, and the Tariff: A Study of Free Private Enterprise in Pressure Politics, As Shown in the 1929–1930 Revision of the Tariff. New York: Prentice-Hall.Google Scholar
Thede, Susanna. 2005. Determinants of Bilateral Trade. World Economy 28: 313–328.Google Scholar
Tsebelis, George. 2002. Veto Players: How Political Institutions Work. Princeton: Princeton University Press.Google Scholar
Zarazaga, Rodrigo 2014. Brokers Beyond Clientelism: A New Perspective Through the Argentine Case. Latin American Politics and Society 56, 3: 23–45.Google Scholar
Supplementary material: File

Pezzola et al. supplementary material

Online Appendix

Download Pezzola et al. supplementary material(File)
File 38.4 KB