The authors thank Robert Feenstra and Xiaopeng Yin for their very full comments for this project. However, all errors remains those of the authors.
Measuring the Impact of Trade Protection on Industrial Production Size
Article first published online: 2 APR 2014
© 2014 John Wiley & Sons Ltd
Review of Development Economics
Special Issue: Issues in Asia. Guest Editor: Laixun Zhao
Volume 18, Issue 2, pages 231–253, May 2014
How to Cite
Tian, W. and Yu, M. (2014), Measuring the Impact of Trade Protection on Industrial Production Size. Review of Development Economics, 18: 231–253. doi: 10.1111/rode.12081
- Issue published online: 2 APR 2014
- Article first published online: 2 APR 2014
Trade theory has no clear prediction on how import protection affects an importing sector's relative size. In this paper, we estimate the impact of US trade protection on industrial production relative size based on a translog GDP functional system. Using an industrial panel data set and controlling for factor endowments and technology improvement, we find empirical evidence that trade protection does not help much increase a sector's relative size. Such findings are also robust to both the inclusion of the role of political economy and the coverage of various non-tariff measures as proxies of industrial protection.