Publication Type

Working Paper

Version

publishedVersion

Publication Date

8-2006

Abstract

This paper proposes a general empirical framework to estimate the protection-for-sale model, where the protection regime shifts according to a sector's market structure (perfectly or monopolistically competitive). We base the protection structure on Grossman and Helpman (1994) for the subset of perfectly competitive sectors and on Chang (2005) for the subset of monopolistically competitive sectors. The two protection regimes are simultaneously estimated with joint constraints. The results of the J-test consistently reject the homogeneous (perfect competition) protection-for-sale model often adopted in previous literature and suggest a direction of improvement toward the proposed heterogeneous protection structure model.

Keywords

endogenous trade policy, campaign contribution, monopolistic competition, intraindustry trade, import penetration

Discipline

International Economics

Research Areas

International Economics

First Page

1

Last Page

32

Publisher

SMU Economics and Statistics Working Paper Series, No. 18-2006

City or Country

Singapore

Copyright Owner and License

Authors

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