Political Ideology and Endogenous Trade Policy: An Empirical Investigation

Pushan Dutt, Devashish Mitra

NBER Working Paper No. 9239
Issued in September 2002
NBER Program(s):   ITI

In this paper, we empirically investigate how government ideology affects trade policy. The prediction of a partisan, ideology-based model (within a two-sector, two-factor Heckscher-Ohlin framework) is that left-wing governments will adopt more protectionist trade policies in capital rich countries, but adopt more pro-trade policies in labor rich economies than right-wing ones. The data strongly support this prediction in a very robust fashion. There is some evidence, that this relationship may hold better in democracies than in dictatorships though the magnitude of the partisan effect seems stronger in dictatorships.

(509 K)

Published:

• Dutt, Pushan and Devashish Mitra. "Endogenous Trade Policy Through Majority Voting: An Empirical Investigation," Journal of International Economics, October 2002, 58(1): 107-133 ,
• Dutt, Pushan and Devashish Mitra. "Political Ideology and Endogenous Trade Policy: An Empirical Investigation." The Review of Economics and Statistics, February 2005, 87(1): 59-72.

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