Democracy and Consumer Strength: Direct Evidence from Regulatory Reform in Developing Countries

The distributional implications of antitrust regulation imply a political cleavage between consumers and producers. I argue that the relative strength of these two groups depends on the level of democracy. In particular, an expansion of the franchise and competitive elections will increase the relative political weight of consumers, resulting in policies that favors their interests. An empirical implication of the argument is that the likelihood of effective competition policy reform increases with democracy. I test this proposition in two stages using an original dataset measuring competition agency design in 156 developing countries covering the period 1975-2007. First, I estimate hazard models on the timing of competition policy reform. Second, since “laws on the books” do not necessarily indicate a commitment to effective policy, I create an original index measuring governments’ commitments to antitrust policy. The index captures the independence of the agency, resource (budget and staffing) allocations, expert perceptions, and actual legal actions. The results of the empirical analysis support the proposition that democracy improves governments’ commitments to competition policy.

In explaining the rise of populism, it’s not economic anxiety vs. identity politics – it’s both.

Many commentators attributed Donald Trump’s surprise 2016 election victory to the role played by voters heavily affected by deindustrialization, often located in the so-called Midwestern ‘Rust Belt’. In new research which examines voting patterns in counties which have experienced manufacturing layoffs, Leonardo Baccini and Stephen Weymouth find that that these layoffs are associated with greater support for Republican challengers among whites compared to voters of color. They attribute this pattern to whites’ concerns about social and economic status loss in the face of layoffs, concerns which are played on by populist and reactionary candidates like Donald Trump

The Consequences of Preferential Trade Agreements: Lessons for U.S.-Latin America Trade Relations

While academic and popular debates tend to focus on differential benefits and costs of trade across countries or industries, this brief highlights winners and losers at the level of individual firms. The authors demonstrate that preferential liberalization produces concentrated benefits among a relatively small number of very large and productive firms

Task force on immigration and higher education in Central Massachusetts

In August 2007, the Colleges of Worcester Consortium, Inc. created a task force to examine the issue of immigration and higher education in Central Massachusetts. It has become increasingly clear from recent demographic and economic studies and projections that the population in the northeast, and certainly in Central Massachusetts, is showing minimal growth. There is evidence that a decline in the “native-born” population is caused by significant out-migration due to a number of factors, including the high cost of living, limited career opportunities and a declining birth rate. The limited population growth that is evident is due primarily to the recent influx of immigrants to this area, with the most significant numbers in Worcester coming from Ghana, Brazil, the Dominican Republic, Kenya, El Salvador, Albania and Liberia. It is also clear that the area’s economy is becoming more knowledge-based with an increasing percentage of all new jobs requiring some form of postsecondary education. According to the 2007 Massachusetts Department of Workforce Development’s Job Vacancy Survey, 38 percent of current job vacancies in Massachusetts require an associate’s degree or higher. This represents an increase from 30 percent in 2003. Consequently, the level of education that the immigrant population attains is of vital importance to everyone—not only to immigrant students and their families but also to the economic well-being of the entire region. The Task Force was charged with researching the barriers to higher education faced by this new wave of immigrants and suggesting recommendations to address those barriers. The 36-member Task Force was made up of representatives from Consortium member institutions; federal, state and local governments; community and faithbased organizations; the Worcester Public Schools; the Massachusetts Board of Higher Education; and the Massachusetts Immigrant and Refugee Advocacy (MIRA) Coalition. Meetings were held over six months, during which the Task Force identified three main barriers faced by immigrant communities in accessing higher education, and sub-committees were created to work on each of these. Speakers were invited to present on topics of interest. Two public hearings were held, the first of which was conducted at Worcester State College in October. It attracted community representatives, as well as college and high school faculty and administrators. The second hearing, held at the downtown branch of Quinsigamond Community College (QCC) in December, was attended by immigrants (English for Speakers of Other Languages – ESOL and GED) students as well as QCC staff.Published versio

Essays on the politics of regulation

This dissertation consists of an introductory chapter and three distinct yet thematically related papers. The purpose of the dissertation is to explain variation in regulatory policy across countries by highlighting the institutional (supply) and interest group (demand) determinants of policy. I develop and test theory explaining regulatory policy outcomes at several levels of analysis. Chapter 1 introduces the topic and related literature. Chapter 2 focuses on the supply of regulatory policy by examining how political institutions affect the responsiveness of policymakers to consumer interests. I argue that the political influence of consumers depends on the level of democracy. To test the theory, I develop an original dataset measuring competition agency design in 156 developing countries covering the period 1975-2007. I estimate hazard models on the timing of competition policy reform. I also create an original index of governments' commitments to antitrust policy and estimate its political determinants. The results confirm a link between democracy and the commitment to consumer-friendly regulatory policy. Chapter 3 holds institutions constant in order to examine the demand-side determinants of regulatory policy outcomes within democracies. I argue that competition policy enforcement reflects the relative political strength of two contending interest groups : a rent-preserving alliance of incumbent producers and affiliated labor opposes competition policies that erode its market dominance; a pro-competition coalition of consumers, unorganized workers, and entrepreneurs favors regulatory oversight. Tests of the timing and nature of reform in democracies support the argument that commitments to antitrust regulatory reform are weakened where the anticompetitive interest group is large and encompassing. Chapter 4 develops hypotheses regarding the firm-level determinants of lobbying and political influence. I argue that economic power translates directly into political power : large, well-organized oligopolists are more likely to lobby and to influence government policy in their favor. I directly test lobbying activity and policy influence using firm-level survey data from over 20,000 firms operating in 41 countries. The results suggest that the political power of the firm increases with its size, market power, and participation in business associations. There is some evidence that the substantive impact of these microeconomic determinants of political influence depends on the level of democrac

Service Firms in the Politics of US Trade Policy

Despite the importance of services in international trade and in the support of global production activities, studies of the political economy of trade liberalization tend to focus on goods trade and the preferences of manufacturing firms and their employees. This article advocates greater consideration of service firms and services trade in political economy models of trade policy. I build my argument around a number of stylized facts about US trade in services. The data suggest that the United States maintains a comparative advantage in services trade, which for standard accounts of trade politics would suggest more homogenous support for trade liberalization within the services sector compared with manufacturing. However, the politics of services liberalization are complicated by the distinct and complex features of international trade in services. Tradable services are delivered internationally through cross-border trade (often electronically), but also through temporary travel and—most importantly for US firms—by a commercial presence, that is, foreign direct investment. These features of services trade imply that governments have an array of policy tools at their disposal with which to protect domestic firms from foreign competition. This article documents the relative importance of various modes of US trade in services, assesses the relationship between policy restrictions and services trade, and discusses how growth in services trade may impact firms’ trade policy objectives

Replication data for: "Unbundling the Relationship between Authoritarian Legislatures and Political Risk."

Replication data for BJPS article on Unbundling Authoritarian Insitution

Exchange Rate Policy Attitudes: Direct Evidence from Survey Data

Analyses of the political economy of exchange rate policy posit that firms and individuals in different sectors of the economy have distinct policy attitudes toward the level and stability of the exchange rate. Most such approaches hypothesize that internationally exposed firms prefer more stable currencies and that producers of tradables prefer a relatively depreciated real exchange rate. As sensible as such expectations may be, there are few direct empirical tests of them. This paper offers micro-level, cross-national evidence on sectoral attitudes about the exchange rate. Using firm-level data from the World Bank's World Business Environment Survey, we find systematic patterns linking sector of economic activity to exchange rate policy positions. Owners and managers of firms producing tradable goods prefer greater stability of the exchange rate: in countries with a floating currency, manufacturers are more likely to report that the exchange rate causes problems for their business. With respect to the level of the exchange rate, we find that tradables producers—particularly manufacturers and export producers—are more likely to be unhappy following an appreciation of the real exchange rate than are firms in nontradable sectors (services and construction). These findings confirm theoretical expectations about the relationship between economic position and currency policy preferences.Governmen