Essays on international trade policy formation

Although the opinion of the economics profession is united in endorsing free trade as the best practice, in most parts of the world international trade is restricted in one way or another. In the last two decades, however, many countries began to adopt more liberal trade regimes. Research on international trade flourished in the last two decades to produce extensive literature on protectionism and trade liberalization. This dissertation proposes and formalizes three reasons for protectionism: politics, revenue motives, and the presence of network externalities. The first reason appears to be the most popular in the literature. The other two are less discussed but perhaps just as compelling as the first. Each of them is studied in turn in the context of a formal model, and the first two are accompanied by some supporting evidence produced through systematic empirical analyses. The essays attempt to explain why governments act the way they do rather than to determine what they should do. As such, the essays deal mainly with developing countries where trade regimes tend to be more restrictive. It is my belief that realistic explanations for trade barriers backed by empirical evidence provide a useful starting point to determine effective policies to bring about freer trade. (Abstract shortened by UMI.)...