It has long been argued that trade restrictions can be motivated by insurance considerations in the absence of full risk diversification. Recent literature suggests that markets for risk can alleviate resistance to reform and protectionist lobby group pressure. We empirically address the...

Due to underlying technological differences, industries differ in their need for external finance. Since the services provided by the financial sector are largely immobile across countries, the pattern of specialization should be influenced by the degree of financial development. We find that...