Political Ideology and Endogenous Trade Policy: An Empirical Investigation

By Pushan Dutt, Devashish Mitra. Review of Economics and Statistics, 2005

173 citations recorded by the source corpus.

In this paper, we investigate empirically how government ideology affects trade policy. The prediction of a partisan, ideology-based model (within a two-sector, two-factor Heckscher-Ohlin framework) is that left-wing governments will adopt more protectionist trade policies in capital-rich countries, but adopt more pro-trade policies in labor-rich countries, than right-wing ones. The data strongly support this prediction in a very robust fashion. There is some evidence that this relationship may hold better in democracies than in dictatorships, though the magnitude of the partisan effect seems stronger in dictatorships.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/a7c45b8804fa4906fca2bd0782fb1a36eba8db9f

Citations in the corpus

• The Political Economy of Agricultural and Food Policies: Recent Contributions, New Insights, and Areas for Further Research (2010, unknown): “An interesting approach to disentangling some of the problems regarding the interactions between political institutions and preferences of autocratic rules is proposed by Dutt and Mitra (2005).”
• Globalization and Economic Growth: A Political Economy Analysis for OECD Countries (2010, unknown): “Dutt and Mitra (2005) also empirically investigate how the ideology of the government in power affects trade policy, by creating a large cross-country database and using a variety of trade policy measures as well as several panel techniques (panel fixed effects and two-stage least squares regression”
• Partisanship, Trade Policy, and Globalization: Is There a Left–Right Divide on Trade Policy? (2004, unknown): “In terms of trade, Dutt and Mitra (2002) demonstrate that in relatively capital rich countries, such as the OECD ones here, left-wing governments do indeed adopt more protectionist trade policies.”