The Political Economy of Policy Instrument Choice: Theory and Evidence from Agricultural Policies | Zendy

Johan Swinnen | Zendy; Alessandro Olper | Zendy; Thijs Vandemoortele | Zendy

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The Political Economy of Policy Instrument Choice: Theory and Evidence from Agricultural Policies

Author(s) -

Johan Swinnen,

Alessandro Olper,

Thijs Vandemoortele

Publication year - 2011

Publication title -

ssrn electronic journal

Language(s) - English

Resource type - Journals

ISSN - 1556-5068

DOI - 10.2139/ssrn.1786347

Subject(s) - politics , agriculture , economics , agricultural policy , public economics , environmental policy , agricultural economics , political science , natural resource economics , geography , archaeology , law

We study the political economy of instrument choice in agricultural and food policies. After a review of the historical evolution of European agricultural price and trade policy instruments since 1880, we develop a political economy model of instrument choice. The key predictions of the model suggest a rational explanation of instrument choice patterns, based on the trade-off between the different cost components of the policies, and internal and external political constraints. An empirical analysis supports the main predictions of the theoretical model. We find that the GATT/WTO agreement had a significant impact.

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