The French (Trade) Revolution of 1860: Intra-Industry Trade and Smooth Adjustment

58 Pages Posted: 22 Oct 2018 Last revised: 14 Apr 2021

See all articles by Stéphane Becuwe

Stéphane Becuwe

University of Bordeaux

Bertrand Blancheton

University of Bordeaux - Montesquieu University - Bordeaux IV

Christopher M. Meissner

University of California, Davis

Date Written: October 2018

Abstract

The Cobden-Chevalier treaty of 1860 eliminated many French import prohibitions and lowered tariffs between France and Britain. Policy change was largely unexpected and unusually free from direct lobbying. A series of commercial treaties with other nations followed because of the use of the unconditional-MFN clause. Post-1860 in France, we find a significant rise in intra-industry trade. On average, rising imports did not prejudice exports. Liberalization allowed for an expansion of two-way trade in differentiated products. The findings are consistent with the “smooth adjustment” hypothesis. Anti-competitive, protectionist lobbying apparent from 1878 was not necessarily a backlash to enhanced international competition.

Suggested Citation

Becuwe, Stéphane and Blancheton, Bertrand and Meissner, Christopher M., The French (Trade) Revolution of 1860: Intra-Industry Trade and Smooth Adjustment (October 2018). NBER Working Paper No. w25173, Available at SSRN: https://ssrn.com/abstract=3270723

Stéphane Becuwe (Contact Author)

University of Bordeaux ( email )

Avenue Léon Duguit
Bordeaux, 33000
France

Bertrand Blancheton

University of Bordeaux - Montesquieu University - Bordeaux IV ( email )

33608 Pessac Cedex
France

Christopher M. Meissner

University of California, Davis ( email )

One Shields Avenue
Apt 153
Davis, CA 95616
United States

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