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This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: The Political Economy of American Trade Policy Volume Author/Editor: Anne O. Krueger, ed. Volume Publisher: University of Chicago Press Volume ISBN: 0-226-45489-4 Volume URL: http://www.nber.org/books/krue96-1 Conference Date: February 3-4, 1994 Publication Date: January 1996 Chapter Title: Front matter, The Political Economy of American Trade Policy Chapter Author: Anne O. Krueger Chapter URL: http://www.nber.org/chapters/c8701 Chapter pages in book: (p. -12-0)

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The Political Economy of American Trade Policy

A National Bureau of Economic Research Project Report

The Political Economy of American Trade Policy Editedby Anne 0. Krueger The University of Chicago Press Chicago and London

ANNE 0. KRUEGER is professor of economics at Stanford University and a research associate of the National Bureau of Economic Research. The University of Chicago Press, Chicago 60637 The University of Chicago Press, Ltd., London 0 1996 by the National Bureau of Economic Research All rights reserved. Published 1996 Printed in the United States of America 05040302010099989796 12345 ISBN: 0-226-45489-4 (cloth) Library of Congress Cataloging-in-Publication Data The political economy of American trade policy / edited by Anne 0. Krueger. p. report) cm.-(a National Bureau of Economic Research project Includes bibliographical references and index. 1. United States-Commercial policy-congresses. 2. Free trade- United States-Congresses. 3. Protectionism-United States- Congresses. I. Krueger, Anne 0. 11. Series. HF1455.P537 1996 382.3 0973-dc20 95-2 I949 CIP @ The paper used in this publication meets the minimum requirements of the American National Standard for Information Sciences-Permanence of Paper for Printed Library Materials, ANSI 239.48-1984.

National Bureau of Economic Research Officers Paul W. McCracken, chairman John H. Biggs, vice-chairman Martin Feldstein, president and chief executive oficer Geoffrey Carliner, executive director Gerald A. Polansky, treasurer Sam Parker, director ofjinance and administration Directors at Large Peter C. Aldrich Elizabeth E. Bailey John H. Biggs Andrew Brimrner Carl E Christ Don R. Conlan Kathleen B. Cooper Jean A. Crockett George C. Eads Martin Feldstein George Hatsopoulos Karen N. Horn Lawrence R. Klein Leo Melamed Merton H. Miller Michael H. Moskow Robert T. Parry Peter G. Peterson Richard N. Rosett Bert Seidman Kathleen P. Utgoff Donald S. Wasserman Marina v.n. Whitman John 0. Wilson Directors by University Appointment Jagdish Bhagwati, Columbia William C. Brainard, Yale Glen G. Cain, Wisconsin Franklin Fisher, Massachusetts Institute of Technology Saul H. Hymans, Michigan Marjorie B. McElroy, Duke Joel Mokyr, Northwestern James L. Pierce, California, Berkeley Andrew Postlewaite, Pennsylvania Nathan Rosenberg, Stanford Harold T. Shapiro, Princeton Craig Swan, Minnesota Michael Yoshino, Harvard Arnold Zellner, Chicago Directors by Appointment of Other Organizations Marcel Boyer, Canadian Economics Charles Lave, American Economic Association Association Mark Drabenstott, American Agricultural Rudolph A. Oswald, American Federation of Economics Associution Labor and Congress of Industrial Richard A. Easterlin, Economic History Organizations Association Gerald A. Polansky, American Institute of Gail D. Fosler, The Conference Board Certijied Public Accountants A. Ronald Gallant, American Statistical James F. Smith, National Association of Association Business Economists Robert S. Hamadd, American Finance Josh S. Weston, Committee for Economic Association Development Directors Emeriti Moses Abramovitz Franklin A. Lindsay George B. Roberts George T. Conklin, Jr. Paul W. McCracken Eli Shapiro Thomas D. Flynn Geoffrey H. Moore William S. Vickrey James J. O Leary

Relation of the Directors to the Work and Publications of the National Bureau of Economic Research I. The object of the National Bureau of Economic Research is to ascertain and to present to the public important economic facts and their interpretation in a scientific and impartial manner. The board of Directors is charged with the responsibility of ensuring that the work of the National Bureau is carried on in strict conformity with this object. 2. The President of the National Bureau shall submit to the Board of Directors, or to its Executive Committee, for their formal adoption all specific proposals for research to be instituted. 3. No research report shall be published by the National Bureau until the President has sent each member of the Board a notice that a manuscript is recommended for publication and that in the President s opinion it is suitable for publication in accordance with the principles of the National Bureau. Such notification will include an abstract or summary of the manuscript s content and a response form Tor use by those Directors who desire a copy of the manuscript for review. Each manuscript shall contain a summary drawing attention to the nature and treatment of the problem studied, the character of the data and their utilization in the report, and the main conclusions reached. 4. For each manuscript so submitted, a special committee of the Directors (including Directors Emeriti) shall be appointed by majority agreement of the President and Vice Presidents (or by the Executive Committee in case of inability to decide on the part of the President and Vice Presidents), consisting of three Directors selected as nearly as may be one from each general division of the Board. The names of the special manuscript committee shall be stated to each Director when notice of the proposed publication is submitted to him. It shall be the duty of each member of the special manuscript committee to read the manuscript, If each member of the manuscript committee signifies his approval within thirty days of the transmittal of the manuscript, the report may be published. If at the end of that period any member of the manuscript committee withholds his approval, the President shall then notify each member of the Board, requesting approval or disapproval of publication, and thirty days additional shall be granted for this purpose. The manuscript shall then not be published unless at least a majority of the entire Board who shall have voted on the proposal within the time fixed for the receipt of votes shall have approved. 5. No manuscript may be published, though approved by each member of the special manuscript committee, until forty-five days have elapsed from the transmittal of the report in manuscript form. The interval is allowed for the receipt of any memorandum of dissent or reservation, together with a brief statement of his reasons, that any member may wish to express; and such memorandum of dissent or reservation shall be published with the manuscript if he so desires. Publication does not, however, imply that each member of the Board has read the manuscript, or that either members of the Board in general or the special committee have passed on its validity in every detail. 6. Publications of the National Bureau issued for informational purposes concerning the work of the Bureau and its staff, or issued to inform the public of activities of Bureau staff, and volumes issued as a result of various conferences involving the National Bureau shall contain a specific disclaimer noting that such publication has not passed through the normal review procedures required in this resolution. The Executive Committee of the Board is charged with review of all such publications from time to time to ensure that they do not take on the character of formal research reports of the National Bureau, requiring formal Board approval. 7. Unless otherwise determined by the Board or exempted by the terms of paragraph 6, a copy of this resolution shall be printed in each National Bureau publication. (Resolutioii adopted October 25, 1926, as revised through September 30, 1974)

Contents Acknowledgments Introduction Anne 0. Krueger ix 1 1. 2. 3. Trade Politics and the Semiconductor Industry 11 Douglas A. Irwin Comment: Andrew R. Dick Steel Protection in the 1980s: The Waning Influence of Big Steel? 73 Michael 0. Moore Comment: William C. Lane Comment: James R. Markusen Comment: Michael H. Moskow The Political Economy of U.S. Automobile Protection 133 Douglas R. Nelson Comment: Anne E. Brunsdale and Randi Boorstein Comment: Richard N. Cooper 4. The MFA Paradox: More Protection and More Trade? J. Michael Finger and Ann Harrison Comment: Robert E. Baldwin Comment: I. M. Destler 197 vii

viii Contents 5. Precedent and Legal Argument in U.S. Trade Policy: Do They Matter to the Political Economy of the Lumber Dispute? 26 1 Joseph P. Kalt Comment: Geoffrey Carliner 6. 7. 8. 9. The Political Economy of U.S. Export Subsidies for Wheat 29 1 Bruce L. Gardner Comment: Robert Paarlberg Agricultural Interest Groups and the North American Free Trade Agreement 335 David Orden Comment: Robert Paarlberg Differences in the Uses and Effects of Antidumping Law across Import Sources Robert W. Staiger and Frank A. Wolak Comment: Kala Krishna Comment: Anne E. Brunsdale and Keith B. Anderson Conclusions Anne 0. Krueger 3 85 423 Contributors 445 Name Index 447 Subject Index 45 3

Acknowledgments This volume was made possible with the support of many people. Special thanks go to those who gave the benefit of their insights and experience in the Washington meeting of conference participants: William Brock, Anne Brunsdale, Michael Moskow, William Frenzel, and Lloyd Olmer. Martin Feldstein supported the project throughout, contributing in all meetings of participants. Roderick Duncan provided research assistance throughout the project. The project was financed by a grant from the Ford Foundation. Special thanks go to Seamus O Clearicain for his support, both in his role as Ford Foundation project officer and in his role as intellectual contributor. ix

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