exists λ<sup> ̄</sup> 0 ¡λ<sup>0</sup> 1¢ > 0 such that for any λ<sup>0</sup> 0<sup>>λ ̄0</sup> ¡λ<sup>0</sup> 1¢, pA ¡f |λ<sup>0</sup> 0<sup>, λ</sup> 1<sup>0</sup> ¢ ≥ p ̃A (f ) . We can thus conclude that there exists λ<sup> ̄</sup> 1 < γ<sup><u>k</u>suchthatforanyλ0</sup> 1<sup>>λ ̄1,thereexistsλ ̄0</sup> ¡λ<sup>0</sup> 1¢ > 0 such that for any λ<sup>0</sup> 0<sup>>λ ̄0</sup> ¡λ<sup>0</sup> 1¢ , (A.20) holds for the economy characterized by a political weight function λ (w) = λ<sup>0</sup> 0<sup>+ wλ</sup> 1<sup>0</sup> . To conclude the argument, we remark that f ∈ [fL, fH] is a compact set, so that the intersection of all the constraints is non-empty. We have hence identified a set of parameters characterizing the political weight function for which the Pivotal Voter curves unambiguously moves inward as a consequence of trade.¥ Proof of Proposition 12: Note that for any entry barrier level f , fr [Π<sup>n</sup> (pr (f ))] = Φ<sup>n+1</sup> (f), and pr [Φ<sup>n</sup> (fr (p))] = Π<sup>n+1</sup> (p), so that by continuity of fr (.) and pr (.), the two requirements (22) and (23) are redundant. We will thus restrict ourselves to condition (22). fT<sup>−1</sup> (fA) is the pivotal voter who prefers fA under the trade regime. Since fT<sup>−1</sup> (fA) > pT (fA) , we know that ΠT £fT<sup>−1</sup> (fA)¤ > ΠT [pT (fA)] as ΠT (.) is the combination of two decreasing functions, hence is increasing. Note then that ΠT £fT<sup>−1</sup> (fA)¤ = pT (fA). Thus, we have pT (fA) > ΠT [pT (fA)]. Applying ΠT (.) sequentially, for any n > 1,

Taking the limit, and defining pT = limn→∞ Π<sup>n</sup> T<sup>[pT(fA)]andfT=limn→∞Φn (fA),fA</sup> belongs to the basin of attraction of (fT , pT ) and the inequality above implies that fA < fT .¥

# B References

1. Acemoglu, Daron, Simon Johnson and James Robinson (2005) “The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth,” American Economic Review, 95, 546-579.

2. Ades, Alberto and Rafael Di Tella (1997) “National Champions and Corruption: Some Unpleasant Interventionist Arithmetic,” The Economic Journal, 107, 1023-1042.

3. Bardhan, Pranab (2003) “Globalization and the Limits to Poverty Alleviation,” mimeo, University of California — Berkeley.

4. Beck, Thorsten, Asli Demirgüç-Kunt, and Vojislav Maksimovic (2005) “Financial and Legal Constraints to Firm Growth: Does Firm Size Matter?” Journal of Finance 60, 137-177.

5. Benabou, Roland (2000) “Unequal Societies: Income Distribution and the Social Contract,” The American Economic Review, 90, 96-129.

6. Bernard, Andrew, Jonathan Eaton, J. Bradford Jensen, and Samuel Kortum (2003) “Plants and Productivity in International Trade” American Economic Review, 93, 1268-1290 7. Bombardini, Matilde (2004) “Firm Heterogeneity and Lobby Participation,” mimeo, MIT.

8. Casella, George, and Roger Berger (1990) “Statistical Inference.” Belmont, California: Duxbury Press.

9. De Janvry, Alain (1981) “The Agrarian Question and Reformism in Latin America,” Baltimore: The John Hopkins University Press.

10. Djankov, Simeon, Rafael La Porta, Florencio Lopez-de-Silanes and Andrei Shleifer (2002) “The Regulation of Entry,” Quarterly Journal of Economics, 117, 1-37.

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