Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/176975 
Year of Publication: 
2018
Series/Report no.: 
CESifo Working Paper No. 6956
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We develop a new theoretical framework of trade agreement (TA) formation, called a ‘parallel contest’, that emphasizes the political fight over TA ratification within countries. TA ratification is inherently uncertain in each country, where anti- and pro-trade interest groups contest each other to influence their own governments’ ratification decision. Unlike prior literature, the protection embodied in negotiated TA tariffs reflects a balance between the liberalizing force of lobbying and inherently protectionist government preferences. Moreover, new international political externalities emerge that are not internalized by governments that just internalize terms of trade externalities.
Subjects: 
contests
international integration
trade agreement
JEL: 
F02
Document Type: 
Working Paper
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