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The political economy of protection in Belgium (Inglês)

This work in progress report is part of an inquiry being undertaken by the World Bank in conjunction with scholars from twelve industrial countries into the penetration of the markets of industrial countries by exports of manufactures from developing countries. The project seeks to establish the share of industrial country markets held by the developing countries, changes in such shares in the 1970s, and why they vary among industry groups and countries. The aim is to assist developing and industrial countries to improve their policies through a better understanding of trade patterns and protectionist pressures. This paper reports the results of the analysis of the causes of protection in Belgium. Tariffs were found to be correlated positively with the total and non-wage value added per person, suggesting that the present structure of the European Community's Common External Tariff supports industries in which Belgium has a comparative advantage. However, industries using scarce natural resources also receive some tariff protection, and non-tariff assistance to industry appears to be skewed toward the more labor intensive products. Government assistance to industry on the whole seems to be favoring sectors that are vulnerable to competition from the developing countries.

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