Submitted manuscript, 151 KB, PDF document
Research output: Working paper
Research output: Working paper
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TY - UNPB
T1 - The political economy of trade protection: the determinants and welfare impact of the 2002 US emergency steel safeguard measures
AU - Read, R A
PY - 2005
Y1 - 2005
N2 - This paper analyses the political economy of trade protection in the context of the factors determining the US Emergency Safeguard Measures for steel imposed March 2002. The paper identifies several factors in addition to the official justification stated problems of global over-capacity and the penetration of imports in the US market, namely the continued failure to restructure poorly performing firms, failure of previous attempts at protection and the influence of the domestic steel lobby and short-term political gains to the Bush Administration of protectionist action. The paper also reviews several ex ante and ex post empirical studies of the impact of the steel Safeguards on the steel industry and downstream steel-consuming activities. All of these studies find that the costs of the Safeguard Measures outweighed their benefits in terms of aggregate GDP and employment as well as having an important redistributive impact. The paper provides a brief summary of the subsequent WTO steel case and the final resolution of the dispute. The evidence suggests that the steel Safeguards owed more to political expediency than justification for protection under the WTO rules.
AB - This paper analyses the political economy of trade protection in the context of the factors determining the US Emergency Safeguard Measures for steel imposed March 2002. The paper identifies several factors in addition to the official justification stated problems of global over-capacity and the penetration of imports in the US market, namely the continued failure to restructure poorly performing firms, failure of previous attempts at protection and the influence of the domestic steel lobby and short-term political gains to the Bush Administration of protectionist action. The paper also reviews several ex ante and ex post empirical studies of the impact of the steel Safeguards on the steel industry and downstream steel-consuming activities. All of these studies find that the costs of the Safeguard Measures outweighed their benefits in terms of aggregate GDP and employment as well as having an important redistributive impact. The paper provides a brief summary of the subsequent WTO steel case and the final resolution of the dispute. The evidence suggests that the steel Safeguards owed more to political expediency than justification for protection under the WTO rules.
KW - WTO
KW - steel dispute
KW - Emergency Safeguard Measures
KW - costs and benefits of protection
M3 - Working paper
T3 - Economics Working Paper Series
BT - The political economy of trade protection: the determinants and welfare impact of the 2002 US emergency steel safeguard measures
PB - The Department of Economics
CY - Lancaster University
ER -