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Trade policy is one determining factor of 19th-century globalization, alongside transport and communication innovations and broader institutional changes that made worldwide commodity and factor flows possible. Four broad periods, or trade policy regimes, can be discerned at the European level. The first starts at the end of the French Revolutionary and Napoleonic wars that had led to many disruptions in trade relations. Governments tried to recover from the financial impact of the wars and to mitigate the adjustment shocks to domestic producers that came with the end of the wars. Very restrictive trade policies were thus adopted in most places and only slowly dismantled over the following decades as some of the welfare costs of, for example, agricultural protection became evident. The second period dated from the mid-1840s, which saw the liberalization of protective grain tariffs in many European countries, to the mid-1870s, when trade liberalization reached its maximum. This period witnessed unilateral trade liberalizations, but is most famous for the spread of a network of bilateral trade agreements across Europe in the wake of the Cobden–Chevalier treaty between France and the United Kingdom in 1860. From the 1870s, industrial and commercial crises and falling prices in agriculture due to global market integration led governments to search for solutions to these policy challenges. Many European countries thus increased protection for agriculture and manufactured goods in which domestic import-competing producers struggled. At the same time, demands for renegotiations threatened the treaty network, and lapsing agreements were only provisionally prolonged. From the late 1880s, the struggle between protection for import-competing producers and market access abroad for export-oriented producers led to internal and external conflicts over trade policy in many countries, including trade (or tariff) “wars.” A renewed network of less ambitious trade treaties than those of the 1860s restored a fragile equilibrium from the early 1890s, to be renewed and renegotiated roughly every 12 years as treaties approached their expiration date. When looking at the country and commodity level it can easily be appreciated that the more or less common shifts during these periods at the European level were more pronounced in some countries than in others. For example, the United Kingdom, the Netherlands, Switzerland, and Belgium shifted more decisively to free trade and remained there, while liberalization was much less pronounced and more decisively undone in Portugal, Spain, Russia, and the Habsburg monarchy. The experiences of the Scandinavian countries, Germany, and France lie somewhere in between. Turkey and the countries that gained independence from the Ottoman Empire in the 19th century started as (forced) free traders and from the 1880s increased their duties, in part to meet growing fiscal demands. At the commodity level, tariffs on raw materials remained generally low and did not follow the protectionist backlash that affected foodstuffs. One exception was (initially) “tropical” goods such as sugar, coffee, tea, and tobacco, where many countries levied high tariffs to extract fiscal revenue. For manufactured goods, liberalization and protectionist backlash were milder than in agriculture, although there are many exceptions to this rule.

While the role of lobbying in trade policy determination has been studied in a formal way since the early 1980s, it was the pathbreaking 1994 work by Grossman and Helpman in the following decade that led many scholars, using that framework (often with some modifications), to study many interesting political economy issues in the trade policy arena. Importantly, Grossman and Helpman were also the first to provide microfoundations to lobbying within a multisectoral, specific-factors framework. Moreover, the industry-level protection they derive is an empirically estimable function of measurable industry characteristics and other political and economic factors. With everything else held constant, organized sectors are able to obtain higher protection than unorganized sectors, with organized-sector protection inversely related to import penetration and import demand elasticity. Grossman and Helpman’s work gave an impetus to theory-driven empirical work in the political economy of trade policy, including the empirical investigation of the Grossman–Helpman model itself and its many extensions. There is now also a fairly large literature trying to explain the unrealistically high empirical estimates of the model’s parameters (representing the proportion of population politically organized and the weight the government attaches to aggregate welfare relative to political contributions). Extensions for empirical investigation that include bringing in competition between upstream and downstream lobbies, imperfect capturing of nontariff barrier (NTB) rents by the government, foreign lobbies, the possibility of misclassfication of sectors into organized and unorganized, and so forth partially correct the unrealistic parameter estimates. In addition, there are extensions that have been applied toward explaining policy changes and puzzles. Those extensions deal with lobby formation, trade agreements, unilateralism versus reciprocity in trade policy, lobbying for protection in declining industries, firm-level lobbying, the choice of policy instruments, and so forth. Despite so much work already done on lobbying and trade policy, the existing literature is deficient in the study of the choice of instruments, the antitrade bias in trade policy, and informational lobbying.

The rise in obesity and other food-related chronic diseases has prompted public-health officials of local communities, national governments, and international institutions to pay attention to the regulation of food supply and consumer behavior. A wide range of policy interventions has been proposed and tested since the early 21st century in various countries. The most prominent are food taxation, health education, nutritional labeling, behavioral interventions at point-of-decision, advertising, and regulations of food quality and trade. While the standard neoclassical approach to consumer rationality provides limited arguments in favor of public regulations, the recent development of behavioral economics research extends the scope of regulation to many marketing practices of the food industry. In addition, behavioral economics provides arguments in favor of taxation, easy-to-use front-of-pack labels, and the use of nudges for altering consumer choices. A selective but careful review of the empirical literature on taxation, labeling, and nudges suggests that a policy mixing these tools may produce some health benefits. More specifically, soft-drink taxation, front-of-pack labeling policies, regulations of marketing practices, and eating nudges based on affect or behavior manipulations are often effective methods for reducing unhealthy eating. The economic research faces important challenges. First, the lack of a proper control group and exogenous sources of variations in policy variables make evaluation very difficult. Identification is challenging as well, with data covering short time periods over which markets are observed around slowly moving equilibria. In addition, truly exogenous supply or demand shocks are rare events. Second, structural models of consumer choices cannot provide accurate assessment of the welfare benefits of public policies because they consider perfectly rational agents and often ignore the dynamic aspects of food decisions, especially consumer concerns over health. Being able to obtain better welfare evaluation of policies is a priority. Third, there is a lack of research on the food industry response to public policies. Some studies implement empirical industrial organization models to infer the industry strategic reactions from market data. A fruitful avenue is to extend this approach to analyze other key dimensions of industrial strategies, especially decisions regarding the nutritional quality of food. Finally, the implementation of nutritional policies yields systemic consequences that may be underestimated. They give rise to conflicts between public health and trade objectives and alter the business models of the food sector. This may greatly limit the external validity of ex-ante empirical approaches. Future works may benefit from household-, firm-, and product-level data collected in rapidly developing economies where food markets are characterized by rapid transitions, the supply is often more volatile, and exogenous shocks occur more frequently.