Trade Policy and Loss Aversion
构建了一个政治经济学模型，将损失厌恶和参照依赖纳入人们对贸易政策的偏好中，解释了为何在价格下跌时保护措施会持续存在，并偏向亏损行业，以美国钢铁业为例。
We develop a political economy model where loss aversion and reference dependence are important in shaping people's preferences over trade policy. The policy implications of the augmented model differ in three ways: there is a region of compensating protection, where a decline in the world price leads to an offsetting increase in protection, such that a constant domestic price is maintained; protection following a single negative price shock will be persistent; and irrespective of the extent of lobbying, there will be a deviation from free trade that favors loss-making industries. The augmented model explains protections of the US steel industry since 1980.