Patriotic consumers and the political economics of agricultural trade

摘要

It is well documented that consumers tend to be patriotic in their choices of food. This paper theoretically examines the consequences of such patriotic behavior for agricultural policy, assuming that the policy is decided by the median voter. The analysis is conducted in the framework of a small open economy, with a ricardian production structure. Consumers differ with respect to how much extra they are prepared to pay for a domestically produced agricultural good. The indirect utility functions areused to find the specific values of tariffs and agricultural subsidies that the various households prefer. For the tariff we find that only the group that buys the domestically produced agricultural good will favor a strictly positive tariff. This tariff is higher the more disadvantage the country has in agricultural production. It is more likely that this group is a majority of the population if this country has a high productivity in the agricultural sector and if the patriotic parameter is large.