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One of the persistent obstacles to trade liberalization is a government’s inability to commit and deliver compensation to trade losers. This paper demonstrates that credible commitments to compensatory policies hinges on inter-branch contract whereby an executive branch promises redistributive compensation in exchange for legislative support of ratification.<\/p>\n
We offer a theory that constitutional structures interact with the geographic concentration of industries to affect the costs of forming and enforcing a compensation contract. Specifically, we argue that geographic concentration facilitates the contract enforcement within a party in parliamentary systems with a smaller number of concerned legislators whereas geographic diffusion promotes coalition-building among larger number of legislators in presidential systems to support liberalization.<\/p>\n
We test this argument using new data on product-level agricultural trade liberalization and remote-sensed cropland data in 48 democracies. We find that parliamentary (presidential) systems are more likely to liberalize geographically concentrated (diffused) products.<\/p>\n
<\/p>\n
\u3010\u554f\u5408\u305b\u3011\u3000\u9ad8\u6a4b\u767e\u5408\u5b50\uff08ytakahashi@waseda.jp\uff09<\/p>\n
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