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Can we obtain realistic parameter estimates for the 'protection for sale' model?
journal contribution
posted on 2006-01-01, 00:00 authored by D Mitra, D Thomakos, Mehmet UlubasogluMehmet UlubasogluIn the Grossman and Helpman (1994) model of endogenous trade protection, sectoral lobbies try to influence an incumbent government that maximizes a weighted sum of political contributions and aggregate welfare. We empirically investigate this model using U.S. and Turkish data. Our specification is more tightly tied to theory than those in existing studies. Additionally, we assume all specific‐factor owners to be organized into different lobbies. These changes, validated by hypothesis tests, yield more realistic parameter estimates of the government's concern for aggregate welfare and of the fraction of population organized into lobbies.
History
Journal
Canadian journal of economicsVolume
39Issue
1Pagination
187 - 210Publisher
Blackwell Publishing Inc.Location
Oxford, EnglandPublisher DOI
ISSN
0008-4085eISSN
1540-5982Language
engPublication classification
C1 Refereed article in a scholarly journalCopyright notice
2006, Canadian Economics AssociationUsage metrics
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