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date: 22 April 2021

Abstract and Keywords

This chapter reviews the sources of protectionist demands by labor, including the factor endowments and specific factors models, and the conditions under which labor interests are likely be incorporated into trade policy. It then discusses how the expansion of international trade institutions has increased the use of temporary trade barriers and compensation, as alternatives to traditional tools like tariffs, to appease protectionist demands. The chapter examines the implications of recent work in economics, in particular the findings of new new trade theory that trade increases unemployment and inequality in developed and developing countries, for trade cleavages and demands for protection. The chapter concludes by discussing the impact of changing patterns of global production on the political influence of labor and the potential for backlash against globalization as possible directions for further research.

Keywords: labor, trade cleavages, protection, influence of labor, new new trade theory

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