This paper analyzes rent-seeking behavior in trade policy based on the Grossman-Helpman (1994) framework. Our empirical implementation deals with Polish trade policy in the late 1990s. We use the instrumental variable approach to estimate the model, accounting for possible endogeneity of the...

pAlthough foreign subsidiaries usually perform better than the average of the hosting economies, empirical literature has also established that the selection effect is statistically significant. In this paper we attempt to evaluate its economic relevance, using a unique data set of annual...