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Pushan Dutt, Devashish Mitra
NBER Working Paper No. 9239*
Issued in September 2002
NBER Program(s): ITI
---- Abstract -----
In this paper, we empirically investigate 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 economies 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.
*Published: Dutt, Pushan and Devashish Mitra. "Endogenous Trade Policy Through Majority Voting: An Empirical Investigation," Journal of International Economics, 2002, v57(1,Oct), 107-133.
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