Asymmetries in Policy Between Exportables and Import-Competing Goods

Anne O. Krueger

NBER Working Paper No. 2904 (Also Reprint No. r1372)
Issued in April 1990
NBER Program(s):   ITI   IFM

This paper reexamines current understanding of the political economy of protection. To date, work has centered on determinants of the height of protection and its form - tariffs, quantitative restrictions, and voluntary export restraints. It is argued that examining the structure of protection misses one important piece of evidence - why import-competing industries tend to be more highly protected than industries producing exportables. When the question is cast in this light, a number of new insights emerge, including the importance of earlier protective measures in influencing current protectionist pressures. "Identity bias", whereby political decisions can be asymmetric between winners and losers, depending on whose identity is known, is introduced.

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Published: The Political Economy of International Trade: Essays in Honor of Robert E. Baldwin. edited by Ronald W. Jones and Anne O. Krueger, pp. 161-178. Oxford: Basil Blackwell, 1990.

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