Recent studies suggest a considerable amount of horizontal strategic interaction amongst governments exists. The empirical approach in these studies typically relies on estimating reaction functions in a uni-dimensional policy framework, where a nonzero slope estimate suggests strategic...

We provide a theory of trade policy determination that incorporates the protectionist bias inherent in majoritarian systems, suggested by Grossman and Helpman (2005). The prediction that emerges is that in majoritarian systems, the majority party favors industries located disproportionately in...