Working Paper: CEPR ID: DP897
Authors: L. Alan Winters
Abstract: This paper appraises the arguments that the creation of the EC has increased world protectionism relative to what it would otherwise have been. Models of tariff bargaining between trade blocs suggest some increase, because the optimum tariff is higher for larger blocs, but this is not inevitable. Models of EC internal decision-taking suggest an increase because of the restaurant-bill problem, the tendency of committees towards universalism, and the attempts of the Commission to wrest control of trade policy from national governments. The arguments are suggestive, but they are not strong enough to be quite certain that a protectionist effect exists.
Keywords: Protectionism; EC; Tariffs; Universalism
JEL Codes: F13; F15; H89
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Establishment of the EC (F55) | Increase in world protectionism (F69) |
| Larger trade blocs (F15) | Higher optimum tariffs (F13) |
| EC decision-making processes (D79) | Protectionist outcomes (F13) |
| Committee-based decision-making (D70) | Bias towards protectionism (F13) |
| Protectionist measures (F13) | Benefit to domestic interests (F52) |