Representation and Delegation in Trade Policymaking: The Political Economy of Trade Taxes in Argentina

Abstract

The literature typically argues that legislative influence on trade policy is scant andreactive because trade policymaking power is largely delegated to the executive.Bridging the literatures on political economy and legislative politics, we analyzelegislative activity on trade taxes in a setting in which delegated powers reverted tothe legislature after decades under executive jurisdiction: the Argentine Chamberof Deputies. Our findings reveal that delegation is the prevailing strategy, legislatorsintervene prompted by economic shocks, and the contents of their initiativesare contingent to the effects of shocks on local economies. When appreciation ragesor devaluation is insufficient, legislators representing export-oriented economiessubmit liberalizing bills, and those representing inward-oriented economies submitprotectionist initiatives. Otherwise, delegation remains the norm and legislators strategicallyemploy declarative bills to signal their preferred policies.