Andreas Dür, Dirk De Bièvre
Constituency Interests and Delegation in European and American Trade Policy
Trade policy in the European Union and the United States is to a large extent delegated to executive agents. Existing explanations claim that legislators delegate because they wish to liberalize but are unable to achieve this on their own. We show that legislators delegate powers to obtain foreign market access for exporters and protection for import-competing interests. Confronted with heterogeneous demands from both groups, principals delegate to two sets of agents to confer concentrated benefits on these constituencies, and install control to avoid concentrated losses, while maintaining the flow of resources from lobbying. We derive the empirically observable implication that, with the increase in the share of tradables in the overall economy, delegation as well as control should have steadily increased over time, and then test the validity of this proposition for US trade policy since 1916 and for European trade policy since 1958.