Lobbying as a Private Good with Intra-Industry Trade

Michael J. Gilligan

    Research output: Contribution to journalArticlepeer-review

    Abstract

    Intra-industry trade - trade in different varieties of the same product between countries with similar factor endowments - has been an important and surprising feature of the postwar international economy. Economists have explained this trade with models of monopolistic competition, which suggest that intra-industry trade does not have the stark distributional consequences that the more traditional "endowments-based" trade does. I do not dispute that claim here, although I do dispute a political implication drawn from it - that intra-industry trade produces less political action than endowments-based trade. I argue that, because firms involved in intra-industry trade are monopolists, lobbying essentially becomes a private good. If intra-industry trade places costs on firms, they do not have less incentive to take political action to stop it, as the conventional wisdom suggests. I provide evidence for this contention from complaints lodged with the International Trade Commission. The results show that the higher the degree of intra-industry trade the more likely an industry will request protection from the ITC.

    Original languageEnglish (US)
    Pages (from-to)455-474
    Number of pages20
    JournalInternational Studies Quarterly
    Volume41
    Issue number3
    DOIs
    StatePublished - Sep 1997

    ASJC Scopus subject areas

    • Sociology and Political Science
    • Political Science and International Relations

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