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Legislative Bargaining over Trade Policy

Author

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  • Ilseok Yang

    (Sungkyunkwan University)

Abstract

This paper analyzes trade policy formation in which three politicians with different preferences bargain over trade policy in a small open economy which has a fixed factor of production. I examine three cases which depend on the share of the factor of production and exogenous parameters in closedrule one-round bargaining. Unlike the previous models in the public choice literature, this model illustrates that the preferences of the centrist party may not be strategically important. As a result, this party may not be a part of the coalition and it is possible that the extreme parties form a coalition.

Suggested Citation

  • Ilseok Yang, 2010. "Legislative Bargaining over Trade Policy," Korean Economic Review, Korean Economic Association, vol. 26, pages 79-96.
    • Handle: RePEc:kea:keappr:ker-20100630-26-1-04
    as

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    File URL: http://keapaper.kea.ne.kr/RePEc/kea/keappr/KER-20100630-26-1-04.pdf
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    References listed on IDEAS

    as
    1. Baron, David P. & Ferejohn, John A., 1989. "Bargaining in Legislatures," American Political Science Review, Cambridge University Press, vol. 83(4), pages 1181-1206, December.
    2. Gans, Joshua S. & Smart, Michael, 1996. "Majority voting with single-crossing preferences," Journal of Public Economics, Elsevier, vol. 59(2), pages 219-237, February.
    3. Thomas Romer & Howard Rosenthal, 1978. "Political resource allocation, controlled agendas, and the status quo," Public Choice, Springer, vol. 33(4), pages 27-43, December.
    4. Chan, Kenneth S., 1988. "Trade negotiations in a Nash bargaining model," Journal of International Economics, Elsevier, vol. 25(3-4), pages 353-363, November.
    5. Kim, Young-Han, 2004. "The optimal trade bargaining strategies in the negotiation of DDA," Journal of Policy Modeling, Elsevier, vol. 26(1), pages 65-80, January.
    6. Thomas Romer & Howard Rosenthal, 1979. "Bureaucrats Versus Voters: On the Political Economy of Resource Allocation by Direct Democracy," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(4), pages 563-587.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Trade Policy; Legislative Bargaining; Agenda Setting; Median-voter;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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