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The Value of Administered Protection: A Capital Market Approach

James C. Hartigan; Philip R. Perry; Sreenivas Kamma

The Review of Economics and Statistics 1986

The focus of this paper i s on the escape clause petitions filed under the Trade Act of 1974 (Section 201). First, the capital marketevent study method is used to analyze the effects of protection decisions. Then, cross-section regressions are performed to examine the influence of key variables on the observed market reaction. The authors conc lude that while protection is beneficial to beleaguered industries, the extent o f such benefits is quite narrowly circumscribed and is conditional on internal v ariables for each firm. Protection is thus not the panacea that its advocates cl aim. Copyright 1986 by MIT Press.

DOI
10.2307/1924520
Volume
68 (4)
Pages
610
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