Veto Points, Veto Players, and International Trade Policy

Abstract

Much of the literature on foreign economic policy focuses on the preferences of societal groups to explain policy decisions. Here, however, the author emphasizes the effects of domestic political institutions that intervene between policy demands and policy decisions. The comparative politics literature on social welfare policy argues that states with more veto points and/or veto players are less able to alter preexisting policies. The author applies this argument to trade policy and tests whether veto points and players affect the ability of states to change tariffs and nontariff barriers in response to changing economic conditions. The sample is a cross-national time-series collection of 23 countries. The results offer support for the argument. Large numbers of institutional veto points are associated with smaller percentage changes in both tariffs and nontariff barriers. These relationships hold even after controlling for the effects of international institutions and for domestic pressures to change tariff and nontariff-barrier levels.