How is U.S. Trade Policy Towards China Determined?

China Economic Review 27 (2013) 25–36

12 Pages Posted: 14 Apr 2016

See all articles by Xiaosong Wang

Xiaosong Wang

Renmin University of China - School of Economics

Kunwang Li

Nankai University - School of Economics

Shenxiang Xie

Shandong University of Finance and Economics

Jack W Hou

California State University, Long Beach

Date Written: Dec. 1, 2013

Abstract

Utilizing a political economy approach towards trade policy formulation, we examine the case of how the U.S. House voted on the PNTR status for China. Our focus is to analyze the factors affecting the legislators' voting behavior and to deduce the rationale behind these factors. We find that the U.S. trade policies towards China represent a balanced equilibrium based on interactions between the government and special interest groups. The individual characteristics of the legislators were not important in the process. Predictions of neo-classical trade models regarding the attitudes of various groups on trade liberalization could not be fully validated in the voting outcome of the PNTR bill.

Keywords: U.S. trade policy towards China; The PNTR bill; Interest group; Political contributions

JEL Classification: F13; B41; D72

Suggested Citation

Wang, Xiaosong and Li, Kunwang and Xie, Shenxiang and Hou, Jack W, How is U.S. Trade Policy Towards China Determined? (Dec. 1, 2013). China Economic Review 27 (2013) 25–36. Available at SSRN: https://ssrn.com/abstract=2763818

Xiaosong Wang (Contact Author)

Renmin University of China - School of Economics ( email )

No. 59, Zhongguancun Street
Beijing, Beijing 100080
China

Kunwang Li

Nankai University - School of Economics ( email )

Wenjin Road
Tianjin, TianJin 300071
China

Shenxiang Xie

Shandong University of Finance and Economics ( email )

Erhuan East Road 7366
Jinan, Shandong 250014
China

Jack W Hou

California State University, Long Beach ( email )

1250 Bellflower Blvd
Long Beach, CA 90064
United States

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