Why Tariffs, Not Subsidies? A Search for Stylized Facts

35 Pages Posted: 9 Jun 2005

See all articles by Jenny Minier

Jenny Minier

University of Kentucky - Department of Economics

Josh Ederington

University of Kentucky - Department of Economics

Date Written: May 2005

Abstract

Barriers to trade are commonly viewed as a result of political systems in which politically influential groups benefit from and successfully lobby for protection. However, trade policy is a highly inefficient tool for redistributing income. Although recent theoretical research has focused on explanations of why (inefficient) trade barriers might be preferred to more direct means of redistribution, this research has been carried out with little empirical support. We address this gap in the literature with an exploratory cross-country empirical investigation of the economic factors correlated with a reliance on tariffs rather than subsidies, and find that the existing theoretical literature is consistent with the cross-country evidence.

Keywords: Endogenous protection, tariffs, subsidies

JEL Classification: F1, F13, D72

Suggested Citation

Minier, Jenny and Ederington, Josh, Why Tariffs, Not Subsidies? A Search for Stylized Facts (May 2005). Available at SSRN: https://ssrn.com/abstract=271149 or http://dx.doi.org/10.2139/ssrn.271149

Jenny Minier (Contact Author)

University of Kentucky - Department of Economics ( email )

335 Business and Economics Building
Lexington, KY 40506
United States

Josh Ederington

University of Kentucky - Department of Economics ( email )

335 Business and Economics Building
Lexington, KY 40506
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
201
Abstract Views
2,406
rank
181,179
PlumX Metrics