PDF, GB, 139 p., 796 Ko - Femise
PDF, GB, 139 p., 796 Ko - Femise
PDF, GB, 139 p., 796 Ko - Femise
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In order to verify the possible impact of different lobbies we applied the Grossman-<br />
Helpman (G-H) “Protection for sale” model to analyze tariff policy. The governmental<br />
policy –in this model - is determined by elected politicians. They simultaneously<br />
consider the consumer welfare of the electorate and contributions of lobbies,<br />
representing various sectors of the economy. Thus, in the model, various lobbies in<br />
organized industries provide contributions to the government in return for influencing<br />
the tariff schedules.<br />
Our empirical implementation (similar to that of Maggi and Goldberg for United States)<br />
is dealing with Polish trade policy in the late 1990s. We have used the instrumental<br />
variable approach to estimate the model, taking into account possible endogeneity of the<br />
regressors (import penetration). In the absence of direct measures of industry<br />
contributions, we have used similar variables to those used in literature, as a proxy for<br />
industry organization. The Herfindahl concentration index seems to be the best proxy<br />
for the industry organization. It means that more concentrated industries with fewer<br />
companies have better chances to coordinate their actions and are more effective in<br />
lobbying. The model was estimated for years 1996-1999.<br />
Our results are broadly in line with the predictions of the Grossman-Helpman (G-H)<br />
model. Most of our regressions support the theory and we find support for the (minor)<br />
significance of lobbies in the formation of trade policy in Poland. The G-H model seems<br />
to work well in the case of MFN tariffs. The importance of the lobbies is, however,<br />
significantly lower than in the case of the United States. According to the model the<br />
Polish government attached very high weight to social welfare, paying almost no<br />
attention to pressures from lobbies. The model finds only very weak support using<br />
preferential data. This result seems plausible since in late 1990’s Poland had already no<br />
freedom in its preferential policy, due to tariff reductions, in line with provisions of the<br />
Europe Agreement.<br />
Thus, we can conclude that the Polish government paid almost no attention to organized<br />
protectionist lobbies, and due to external pressure from the EU, EFTA and WTO<br />
liberalized its tariff policy very rapidly in the second half on 1990’s. It seems that a<br />
similar situation prevailed in other Central and East European, future NMS. All of them<br />
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