Strategic Trade Policy is not Good Strategy

Abstract

The focus of this paper is the process by which strategic trade policy is implemented.Due to an institutional structure under which democratic government is responsive to pressure groups, strategic trade policy may include strong protectionist elements. While the objective of strategic trade policy is to promote new frm-specific advantages for chosen industries, in practice a type of corporate "shelter" results. In terms of the strategic management literature we find that there is a type of "administrative heritage" in government policy making that hinders the implementation of effective strategic trade policy. From the viewpoint of both corporate strategy and public policy, we find that the result is neither efficient nor effective. is a third importing country. This situation calls for a "strategic game" since the actions of one firm wi]1 be strongly influenced by the other frm's moves.

The effects of US import tariffs on steel and aluminum imports from Mexico

“…• protect infant industries (Shafaeddin, 2000;Baldwin, 1969;Krueger and Tucner, 1982;Harrison, 1994;Melitz, 2005;Sauré, 2007;Panagariya, 2011;Xu, 2006;Clemhout and Wan Jr., 1970); • protect senile industries (Gray, 1973;Hillman, 1982;Choi, 2001;Long and Vousden, 1991;Magee, 2002;Lee and Swagel, 1997;Hillman and Cassing, 1986;Brainard and Verdier, 1997); • undertake anti-dumping actions (Panagariya and Gupta, 1998;Brenton, 2011;Dinlersoz and Dogan, 2010;Cheng et al, 2001); • shape strategic trade policy Krugman, 1994;Brander, 1995;Rugman and Verbeke, 1990;Grossman and Maggi, 1997;Ionaşcu and žigić, 2001). The most frequently raised reason is the need to protect national producers and suppliers, shift demand from imported towards domestic products, and reduce unemployment.…”