This book provides a special interest theory of protection, developing a full general equilibrium theory that explains the distribution of income with goods markets, factor markets, lobbies, political parties, and voters all pursuing their self interest. This probabilistic voting model shows how well-organized groups can use seemingly irrational government policies to exploit poorly organized groups. Given rational predatory behavior between these groups, protection or any other redistributive policy that improves the chances of election of a party increases political efficiency. This can create an economic black hole, conditions under which an entire economy can disappear into lobbying. Paradoxically, the tariff rates accompanying an economic black hole are very low. The economic waste is confined to lobbying costs. The book contains both theoretical and empirical work explaining protection in the United States (1900-1988) and levels of protection in about sixty foreign countries in the 1980s.
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"This book takes a major step toward giving us a real understanding of why we observe restrictive protectionism despite the free-trade arguments advanced by economists for more than two centuries." James M. Buchanan
"Magee, Brock, and Young are the pioneers of modern political economy. Since the early 1970s their work has provided the theoretical microfoundations for the subject. This long-awaited book also demonstrates empirical tests of the theory. The Magee-Young theorem of increasing returns to the abundant factor will join the Rybczynski theorem as a core proposition in the theory of international trade." Robert E. Baldwin
"The best of all the 'rational choice' models of politics. The political science establishment should be mortified that it had to be written by economists." Thomas Ferguson
"Sixteen years have elapsed since Brock and Magee began their promising work on the theory of protection. Now they and Leslie Young have shown that our wait has been properly rewarded. Here is a wide-ranging and highly imaginative treatment of protectionism and the underlying theory of coalitions." George J. Stigler
"Magee, Brock, and Young are the pioneers of modern political economy. Since the early 1970s their work has provided the theoretical microfoundations for the subject. This long-awaited book also demonstrates empirical tests of the theory. The Magee-Young theorem of increasing returns to the abundant factor will join the Rybczynski theorem as a core proposition in the theory of international trade." Robert E. Baldwin
"The best of all the 'rational choice' models of politics. The political science establishment should be mortified that it had to be written by economists." Thomas Ferguson
"Sixteen years have elapsed since Brock and Magee began their promising work on the theory of protection. Now they and Leslie Young have shown that our wait has been properly rewarded. Here is a wide-ranging and highly imaginative treatment of protectionism and the underlying theory of coalitions." George J. Stigler
Book Description
An example of special interest protection is provided by this study's general equilibrium theory that explains income distribution with goods markets, factor markets, lobbies, political parties and voters all pursuing their self interests.
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4.0 out of 5 stars
The most formally sophisticated model of its kind,
By JasonC (Boston, MA United States) - See all my reviews
This review is from: Black Hole Tariffs and Endogenous Policy Theory: Political Economy in General Equilibrium (Paperback)
This is a fine book, easily the most formally sophisticated model of its kind. The idea is to formalize political economy, getting beyond stale ideological discussions, and instead plop down an entire political subsystem in the middle of a standard (if simplistic) general equilibrium economic model. Groups allocate resources between economic and political activity; parties position themselves to gather financial support as well as votes. The economic and political consequences of their mutual decisions play out in a minimax general equilibrium fashion. Repays detailed study.
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This review is from: Black Hole Tariffs and Endogenous Policy Theory: Political Economy in General Equilibrium (Hardcover)
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Inside This Book
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First Sentence:
Wealth comes from two sources: production and predation. Read the first page Key Phrases - Statistically Improbable Phrases (SIPs): (learn more)
proexport party, proexport lobby, prolabor party, magnification paradox, protectionist contributions, contribution specialization theorem, lobbying power function, endogenous policy model, invisible foot economy, split contributors, invisible foot economies, more indirect policy, lobby contributions, electoral odds, tariff equation, probabilistic voting function, lobbying ratio, net marginal value product, optimal obfuscation, endogenous policy theory, protectionist party, capital lobby, endogenous tariff theory, labor lobby, factor lobbies Key Phrases - Capitalized Phrases (CAPs): (learn more)
United States, Prisoner's Dilemma, Leslie Young, New York, Cambridge University Press, World War, Franklin Roosevelt, House Democrats, White House, Costa Rica, Great Depression, New Zealand, United Kingdom, Sierra Leone, Appendix Table, House of Representatives, University of Chicago, West Germany, Code Country Actual Predicted Act, House Republicans, Papua New Guinea, World Bank, Year Figure, Dominican Republic, Great Britain New!
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Front Cover | Table of Contents | First Pages | Index | Back Cover | Surprise Me!
Wealth comes from two sources: production and predation. Read the first page Key Phrases - Statistically Improbable Phrases (SIPs): (learn more)
proexport party, proexport lobby, prolabor party, magnification paradox, protectionist contributions, contribution specialization theorem, lobbying power function, endogenous policy model, invisible foot economy, split contributors, invisible foot economies, more indirect policy, lobby contributions, electoral odds, tariff equation, probabilistic voting function, lobbying ratio, net marginal value product, optimal obfuscation, endogenous policy theory, protectionist party, capital lobby, endogenous tariff theory, labor lobby, factor lobbies Key Phrases - Capitalized Phrases (CAPs): (learn more)
United States, Prisoner's Dilemma, Leslie Young, New York, Cambridge University Press, World War, Franklin Roosevelt, House Democrats, White House, Costa Rica, Great Depression, New Zealand, United Kingdom, Sierra Leone, Appendix Table, House of Representatives, University of Chicago, West Germany, Code Country Actual Predicted Act, House Republicans, Papua New Guinea, World Bank, Year Figure, Dominican Republic, Great Britain New!
Books on Related Topics | Concordance | Text Stats Browse Sample Pages:
Front Cover | Table of Contents | First Pages | Index | Back Cover | Surprise Me!
Citations (learn more)
This book cites 132
books:
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20
books
cite this book:
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- US Trade Policies in a Changing World Economy by Robert M. Stern on 6 pages
- Import Competition and Response (National Bureau of Economic Research Conference Report) by Jagdish Bhagwati on 5 pages
- Neoclassical Political Economy: The Analysis of Rent-Seeking and Dup Activities by David C. Colander on 4 pages
- Current Issues in Commercial Policy and Diplomacy: Papers of the Third Annual Conference of the International Economic Study Group by John Black on page 72, Back Matter (1), and Back Matter (2)
- The Political Economy of Growth by Dennis Mueller in Back Matter (1), Back Matter (2), and Back Matter (3)
See all 132 books this book cites
- International Trade Theory and Policy by Giancarlo Gandolfo on page 222, and page 418
- Japan's Trade Policy: Action or Reaction? (Routledge Studies in the Growth Economies of Asia) by Yumiko Mikanagi in Back Matter (1), and Back Matter (2)
- Trade Reform and Regional Integration in Africa: Papers Presented at the Imf African Economic Research Consortium Seminar on Trade Reform and Regional Integration in Africa, December 1-3, 1997 by Zubair Iqbal on page 64
- Disarray in World Food Markets: A Quantitative Assessment (Trade and Development) by Rod Tyers in Back Matter
- Special Interest Politics by Gene M. Grossman in Back Matter
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