By Alan Verne Deardorff, Robert Mitchell Stern
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There is the further question of whether the existing models accurately represent the role of the interest groups that they do involve. The lobbying process is realistically much more complicated than is allowed for in the existing political economy models, especially insofar as non-monetary interactions may be as important as monetary contributions. We recognize, and in fact learned from some of the early political economy models, that complication for its own sake will not help us much. But nonetheless it seems likely to be important that lobbying activities often require time and other resources as much as money, and that the motives of those involved may not be, as a first approximation, selfish.
Trade policy. S. trade law or threats of petitions under this law. Resort to trade law thus now represents the only effective way in which industry interests can be pursued, and, with the advent of the WTO, dispute settlement procedures will strengthen the role of trade policy built on trade law. While this situation might appear not to be to the liking of the Congress, Greenwald notes that most members of Congress favor an open global trading system and look upon trade law remedies as a means of responding to constituent interests for assistance.
Fortunately, if factors are narrowly owned while consumer interests are broad, this approach predicts counter-factually that tariffs will be nonexistent, or even negative. In the H-O model, if labor ownership is broad while capital ownership is concentrated, the model delivers protection on the labor intensive good, which seems more plausible. S. Trade Policies model, decision can be taken away from the median voter and a broad pattern of protection favoring specific factors can emerge. However, the approach suffers in all cases from the unreality of the assumption that individual tariffs are determined by majority vote, which is virtually never the case in practice.