By Seiichi Katayama, Heinrich W. Ursprung
In this quantity we amassed the various papers that have been awarded on the RIEB (The learn Institute for Economics and enterprise management) overseas convention at Kobe college on March 25 and 26, 2000. The contributions invited for presentation all handled particular features of the convention subject "Trade coverage: Political economic climate and Dynamic Issues". meanwhile the papers amassed during this quantity were revised, and a few of them were released in expert journals. This quantity therefore comprises released in addition to hitherto unpublished contributions. we're thankful to the entire authors and the convention individuals, espe cially to people who cheerfully served as discussants and chairpersons. Our thank you additionally visit our colleagues on the RIEB for his or her encouragement, and particularly to the RIEB's Director, Professor Shoji Nishijima for his help of the venture. we're additionally thankful to Professor Arye Hillman at Bar-Han college, who kindly learn elements of the manuscript and provided valuable com ments and recommendations. within the editorial strategy we have been lucky as a way to depend on a superb and capable crew: we're super thankful to Minako Okuno, Yuji Fujinaka, Tetsuya Saito for his or her extraordinary paintings and to Shinya Horie who undertook the trials taking task and accomplished the camera-ready reproduction for e-book. we're additionally thankful to Professor Charles Noussair of Emory collage who kindly provided suggestions.
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A direct implication of proposition 12 is that, under the multiplicative formulation (28), lobbying opportunities can reverse the profit ranking of domestic firms. In the absence of lobbying opportunities, the marginal production cost of firm h is its base-line level eg. The higher is a firm's base-line level, the lower is its rank in terms of profit. When opportunities to lobby become available, the firms with lower base-line costs will spend more time in lobbying, and as a consequent, their marginal production costs rise, while firms with higher base-line costs do not allocate much time in lobbying, and thus their marginal production costs do not rise by much.
Proof. By definition, if j and k are politically active, their lobbying pressures are positive. Hence Ak = Aj = 0 and (13) gives G(PN(ON)) - bOj G(PN(ON)) - bOk l+¢'(L j ) 1 + ¢'(Lk) Thus, OJ < Ok implies ¢'(L j ) > ¢'(L k ), and, since ¢/1 > 0, we have Lj > Lk• 42 Ngo Van Long We now ask the following question: if the goods become closer substitutes in the consumers' mind, will the total lobbying pressure rise? Intuitively, one would expect that the answer is "yes". Proposition 4 A small increase in the substitutability of the products will lead to a greater lobbying pressure for tariff protection.
An increase in E leads to a fall in PN, as expected. ) In stage 1, the home government determines the tariff rates tr on goods produced by the m* foreign oligopolists, in response to the total lobbying pressure L exercised by the domestic firms. For simplicity, we assume tr = t for all f E F. Here L is the sum oflobbying pressures, L h , hE H, by individual domestic firms: We postulate that t = t(L), t/(L) > 0, til (L) <0 The signs of these derivatives reflect the usual assumptions that the marginal effectiveness of lobbying pressure is positive and diminishing.
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