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kbuzard / pe-shocks

Endogenous Politics and the Design of Trade Institutions
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Literature Review Expansion #1

Open oagarcia086 opened 6 months ago

oagarcia086 commented 6 months ago

This issue will be used to report findings, issues and/or ask questions as Orlando works on expanding the literature review of this project.

oagarcia086 commented 3 months ago

Thank you now I know for future reference! Can you tell me I little bit more about what you are looking for when I organize all the papers? I am asking before I start working on this task.

kbuzard commented 3 months ago

Thank you now I know for future reference! Can you tell me I little bit more about what you are looking for when I organize all the papers? I am asking before I start working on this task.

The first step is just to compile the list--of everything I already had in the paper, plus everything new that has been found this summer.

While you're waiting for feedback from me, please add any new papers to the .bib file (I just added tradeagreements.bib to Github and recompiled the paper so that the references work correctly--the bib file had been in a different folder on my hard drive that Github didn't have access to), and also update ones that are listed as working papers of any kind with any new information you can get on Google Scholar.

oagarcia086 commented 3 months ago

Thank you! I am traveling to Orlando with the family to see my sister. I will start working on this tomorrow.

oagarcia086 commented 3 months ago

@kbuzard I have a "silly question". Can I just update the bib file with the new papers and recompile the paper? or would the printbibliography latex command not update with the new papers in the bib file because they are not referenced in the paper (yet)

kbuzard commented 3 months ago

@kbuzard I have a "silly question". Can I just update the bib file with the new papers and recompile the paper? or would the printbibliography latex command not update with the new papers in the bib file because they are not referenced in the paper (yet)

Yes, printbibliography would not add anything that hasn't been referenced. But, for now, you could just make a list of references as the end of the conclusion so that it WILL add them. We can delete/comment that out later.

oagarcia086 commented 3 months ago

@kbuzard I have a "silly question". Can I just update the bib file with the new papers and recompile the paper? or would the printbibliography latex command not update with the new papers in the bib file because they are not referenced in the paper (yet)

Yes, printbibliography would not add anything that hasn't been referenced. But, for now, you could just make a list of references as the end of the conclusion so that it WILL add them. We can delete/comment that out later.

Sounds good! I am about to issue commits for both the bib file and the draft. I updated the bibtex citation so it matches the rest of the file (i did not touch the first line of the entry as instructed above). Hopefully it works!

kbuzard commented 3 months ago

Sounds good! I am about to issue commits for both the bib file and the draft. I updated the bibtex citation so it matches the rest of the file (i did not touch the first line of the entry as instructed above). Hopefully it works!

Just let me know when you've pushed it and I'll take a look.

oagarcia086 commented 3 months ago

I just submitted a pull request for you to review.

oagarcia086 commented 3 months ago

Friday August 9th and Monday August 13th

Hours Worked: 2.5 Hours worked this week: 1.5

On Friday, I created two separate pull requests with changes to the bib and draft.tex files. @kbuzard requested that I do this as a single commit/pull/push request with all the files through github desktop. On Monday I completed this task.

kbuzard commented 3 months ago

@oagarcia086 I just merged the pull request, and yes, it IS what I was hoping for in regards to adding the new papers.

I'd also like you to update the bibliographic information on the pre-existing papers wherever possible. For instance, "Trade Disputes and Settlement" is no longer a working paper. It was published in the IER in 2018. Please update the .bib entry for this and any other working paper that has since been published.

oagarcia086 commented 3 months ago

@kbuzard As requested, I just sent a pull request for the changes to the bib file. The pull request includes the papers that were updated.

kbuzard commented 3 months ago

@kbuzard As requested, I just sent a pull request for the changes to the bib file. The pull request includes the papers that were updated.

This is great. Thanks!

Can you make a list for me, now, of all the papers we know of (I think they are now all in the bibliography of the paper, right?) that include endogenous politics? It can just be a bulleted list here.

oagarcia086 commented 3 months ago

Below are the papers I have found that have Endogenous Politics:

kbuzard commented 3 months ago

Below are the papers I have found the have Endogenous Politics:

Thanks @oagarcia086 ! I think the last thing I need is a summary that pulls these together and shows how they're related in terms of the government objective function.

oagarcia086 commented 3 months ago

Would you like me to put this together in a pdf or a bulleted list here?

kbuzard commented 3 months ago

Would you like me to put this together in a pdf or a bulleted list here?

A bulleted list here would be great!

kbuzard commented 3 months ago

In some strange timing, I just went through a pile of papers that's been on my desk for two years. I found "Rents and International Trade Policy" by Arye Hillman in there.

First, I don't really necessarily recommend reading it; while I think it's making an interesting point, it's very hard to follow.

Second, there were a few references in there to older papers that may have endogenous politics. Would you take a look when you get a chance? No hurry--I'm not going to be able to get back to this for a while with classes starting tomorrow.

oagarcia086 commented 3 months ago

Yes, of course! Always happy to help. I was half way through typing my suggested answers to last week's task when you sent this. Would you mind if I hold on that and look at this first? If I find anything, I believe they are going to end up in the list I was working on.

kbuzard commented 3 months ago

Yes, of course! Always happy to help. I was half way through typing my suggested answers to last week's task when you sent this. Would you mind if I hold on that and look at this first? If I find anything, I believe they are going to end up in the list I was working on.

Yes, that makes perfect sense.

oagarcia086 commented 2 months ago

In some strange timing, I just went through a pile of papers that's been on my desk for two years. I found "Rents and International Trade Policy" by Arye Hillman in there.

First, I don't really necessarily recommend reading it; while I think it's making an interesting point, it's very hard to follow.

Second, there were a few references in there to older papers that may have endogenous politics. Would you take a look when you get a chance? No hurry--I'm not going to be able to get back to this for a while with classes starting tomorrow.

  • Ethier 2004, 2013
  • Regan 2006, 2016 (I think I read this before and it's not formal theory at all, but I could be wrong)
  • Hillman et al (1995)
  • Hillman and Moser (1996)
  • Hillman (1982) and (1989)
  • Cassing and Hillman (1985) and (1986)

Update: I was able to find all of these articles. I am going to start going through to them and see if any of them have endogenous politics. I believe I will not find anything in the Regan pieces. He's a law professor publishing in law journals but i could be wrong.

kbuzard commented 2 months ago

I agree about Regan. I read at least one of his pieces years ago and this aligns with my recollection.

oagarcia086 commented 2 months ago

Question. Hillman (1982) talks about prices for a particular industry's output being derived by the government maximizing the "political support function" for that industry. I would consider that endogenous politics. He also discusses the government responding the trade liberalization by increasing tariffs to make protectionists happy. I do not see anything about international agreements in this paper though. Would you agree with my statement?

kbuzard commented 2 months ago

Question. Hillman (1982) talks about prices for a particular industry's output being derived by the government maximizing the "political support function" for that industry. I would consider that endogenous politics. He also discusses the government responding the trade liberalization by increasing tariffs to make protectionists happy. I do not see anything about international agreements in this paper though. Would you agree with my statement?

Yes, definitely endogenous politics. I'm not familiar with the individual papers, so I can't speak to the international agreements part. I think I'd like to have at least one of his papers in the lit review, so to that end, would you give me a short summary (maybe the abstract if it's good) of each of his papers so I can pick?

oagarcia086 commented 2 months ago

P.S. I need to reserve a book called “The New Transatlantic Economy” from Bird library to read Hillman and Moser (1996).

kbuzard commented 2 months ago

@oagarcia086 I think we can leave off Cassing and Hillman (1986) and the book. In the others, would you see if there's a formal model, and if so, what it is?

oagarcia086 commented 2 months ago

@kbuzard I've noticed that I am having difficulties using markdown whenever I need to write more than one equation within the same line. Any suggestions on how I can handle this? Thank you!

Hillman (1982):

The price of a particular industry's output derives from maximization by the authorities of a political support function for that industry

\$$ M(P) = M[\pi(P), P] \$$

where P is price and $$\ \pi(P) $$ is the industry's profit function. Higher industry profit elicit greater political support from industry-specific interest.

The authorities use their regulatory powers to maximize political support by choosing the industry's price to satisfy

\tilde{M}_p = M_{\pi} \pi_p + M_p = 0

The regulatory price which solves this equations to yield a maximum for $$\tilde{M}_p $$ lies between the profit-maximizing and competitive prices.

Cassing and Hillman (1985)

The government chooses the level of protection to maximize a strictly quasiconcave political-support function 

M[\Delta P, \Delta \Pi] = M[P - P^*, \Pi - \Pi^*]

where $$\ P^ $$ and $$\ \pi^$$ are world price and the level of industry profits in the absence of protection. $\ Delta P = (P - P^*)$

kbuzard commented 2 months ago

This is helpful. Thanks! Is there any specificity on the functional form of the M function?

ChatGPT says that sometimes with very short expressions, "GitHub's renderer may get confused with inline math when it's combined with regular text."

This will work: $P^ \text{ and } \pi^$.

oagarcia086 commented 2 months ago

The M function exhibits diminishing marginal industry support as profits are increased by increases in the regulated price and increasing marginal consumer antagonism as consumers' welfare is decreased ($$M{\pi\pi} $$ and $$M{pp} $$ <0). Furthermore, if consumers' antagonism towards the authorities increases the more the industry has already benefited from higher prices, there is an "envy effect" reflected in $$M_{\pi p} <0$$

kbuzard commented 2 months ago

The M function exhibits diminishing marginal industry support as profits are increased by increases in the regulated price and increasing marginal consumer antagonism as consumers' welfare is decreased ( M π π and M p p <0). Furthermore, if consumers' antagonism towards the authorities increases the more the industry has already benefited from higher prices, there is an "envy effect" reflected in M π p < 0

Just what I was looking for. Thanks!

oagarcia086 commented 2 months ago

Below are the papers I have found the have Endogenous Politics:

Thanks @oagarcia086 ! I think the last thing I need is a summary that pulls these together and shows how they're related in terms of the government objective function.

  • Please group together papers that share a common objective function (for instance, the two Maggi & Rodriguez-Clare papers belong together).
  • Include a simple equation for the objective function (no need to define common terms like CS, TR, etc.).
  • For each paper, 2-3 sentence about what results from the endogenous politics (e.g., a motive to use trade agreements to constraint inefficient politics in MRC 2007 because firms have an incentive to overinvest...)
  • Include insights (if any) about how the groups relate to each other (e.g., how is story/mechanics of MRC different from/the same as Devashish's 2002 paper?)

Can I continue working on this document and add the Hillman paper to it?

kbuzard commented 2 months ago

@oagarcia086 Sounds perfect!