Trade Protectionism: Reasons and Impacts

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In the context of trade policy outcomes, what model focuses on protection for sale?

Protection for sale model

According to Fernandez and Rodrik (1991), why do countries tend to have an anti-trade bias?

Due to uncertainty about trade consequences

What do Dhingra (2014) findings add to the discussion about the Median Voter Model?

They explain the lack of import subsidies

Why do democracies not perfectly fit the assumptions of the Protection for Sale model according to Grossman and Helpman (1994)?

<p>They assume a perfect and direct democracy</p> Signup and view all the answers

What characteristic of congressional districts is considered in Baldwin and Magee's (1998) study on trade negotiations?

<p>Worker demographics</p> Signup and view all the answers

Which concept suggests that some industries should receive domestic subsidies due to generating positive externalities?

<p>Domestic market failure</p> Signup and view all the answers

How does the Median Voter Theorem predict policies when established by majority vote?

<p>Based on utility of median voter</p> Signup and view all the answers

What is the main implication of lobbying in the Protection for Sale model according to Grossman and Helpman?

<p>Leads to diluted gains from trade</p> Signup and view all the answers

In what way does Economic and geographic concentration help interest groups overcome costs of collective action?

<p>It makes it easier to monitor free riding behavior</p> Signup and view all the answers

Why might some industries vanish due to free trade, according to Grossman and Helpman's argument?

<p>Losses from trade are concentrated in these industries</p> Signup and view all the answers

What is one of the reasons that can explain trade liberalization from 1990 to 2016?

<p>Juggernaut effect</p> Signup and view all the answers

Why do exporters become more powerful relative to import-competing producers as tariffs decline abroad?

<p>Reciprocity principle</p> Signup and view all the answers

What effect does unilateral liberalization have on joining global value chains?

<p>Increased specialization</p> Signup and view all the answers

Which theory suggests that left-out countries are incentivized to sign Free Trade Agreements (FTAs)?

<p>Domino theory</p> Signup and view all the answers

Why do countries lower tariffs unilaterally according to the text?

<p>To join global value chains and specialize</p> Signup and view all the answers

How does the reciprocity principle impact exporters' lobbying efforts?

<p>Strengthens their lobbying power</p> Signup and view all the answers

Which factor contributes to exporters' increased power when tariffs decline abroad?

<p>Reciprocity principle</p> Signup and view all the answers

What does the Juggernaut effect imply for exporters lobbying for free trade agreements?

<p>Increased power relative to importers</p> Signup and view all the answers

What motivates countries to sign Free Trade Agreements according to the Domino theory?

<p>Fear of loss to other countries benefiting from FTAs</p> Signup and view all the answers

What benefit does unilateral liberalization offer in terms of specialization?

<p>Increases specialization opportunities</p> Signup and view all the answers

What is a key reason why trade protectionism is appealing to some?

<p>It benefits specific groups like consumers and owners of abundant factors</p> Signup and view all the answers

How did import restrictions on sugar in 1998 affect US sugar industry profits?

<p>Profits increased by about 1 billion, with half going to only 17 sugarcane farms</p> Signup and view all the answers

What was the estimated annual cost to US consumers due to the wire hanger antidumping duties in 2008?

<p>$120 million</p> Signup and view all the answers

Why did the US Department of Commerce impose antidumping duties on wire clothes hangers from China in 2008?

<p>Due to a petition by M&amp;B Products Co. from Alabama</p> Signup and view all the answers

Who benefited the most from import restrictions on sugar in 1998?

<p>17 sugarcane farms receiving almost half the gain</p> Signup and view all the answers

Which group among the following was NOT identified as a loser due to trade protectionism in the text?

<p>17 sugarcane farms</p> Signup and view all the answers

How did Olson's asymmetry contribute to the appeal of trade protectionism?

<p>' By showing that gains are dispersed while losses are concentrated'</p> Signup and view all the answers

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