Trading Places: Industries for Free Trade

Abstract

AbstractMany scholars expected U.S. trade policy in the 1970s and beyond to look like that of the 1920s and 1930s—i.e., to be marked by widespread and high levels of protectionism. The American market, however, remained relatively open. One central reason was the growth of antiprotectionist sentiment among American firms. Firms now opposed protection because they had developed extensive ties to the international economy through exports, multinational production, and global intrafirm trade. The development of these international ties by the 1970s reduced protectionist pressure by American firms even when they were faced with serious import competition: protection had become too costly. The preferences of these firms also seemed to affect trade policy outcomes, turning them away from protection.