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Article
Free-Riding on Federalism: Trade Protection and the Canadian Dairy Industry
Canadian Public Policy
(2003)
Abstract
This paper examines the link between federalism, rent-seeking and free-riding behaviour. Using data from the Canadian dairy industry, we test four hypotheses of the determinants of rent-seeking expenditure and the role of free-riding. First, we find that provinces do not cooperate with each other when lobbying the federal government for trade protection. Second, some provinces are found to free ride on the rent-seeking expenditure of the larger (more influential) provinces. Third, the cost of rent-seeking increases when the government is forced to make a decision regarding the future of the protectionist policies. Fourth, institutional changes under the 1994 GATT raised the rent-seeking cost of maintaining protectionist policies.
Keywords
- rent seeking,
- free-riding,
- political economy,
- trade,
- dairy,
- Canada
Disciplines
Publication Date
2003
Citation Information
Kathy Baylis and W. Hartley Furtan. "Free-Riding on Federalism: Trade Protection and the Canadian Dairy Industry" Canadian Public Policy Vol. 29 Iss. 2 (2003) Available at: http://works.bepress.com/kathy_baylis/6/