include this interaction term in addition to each variable entering independently. The interaction term examines the possibility that economy _j_ may be less likely to impose new import protection against trading partner _i_ – despite _j_ ’s own domestic economic contraction – if there is a simultaneous negative economic shock abroad. If this were the case, since a negative shock to the domestic economy is captured as an increase in the domestic unemployment rate, we would expect an estimated IRR that is less than 1 for the interaction term and a potentially insignificant IRR estimate for the domestic unemployment change variable. However, we find no evidence of these relationships for this time period and this sample of policy-imposing economies.<sup>17</sup> Finally, in specifications (7) and (8), we address the issue that the five economies might face different choice sets of import restrictions. First, the extent to which WTO commitments restrict an economy’s freedom to raise its applied most-favored-nation (MFN) tariff rates might vary across economies.<sup>18</sup> In specification (7), we control for this by introducing a new variable defined as the annual change in the share of economy _j_ ’s HS-06 products subject to strict WTO discipline, i.e., the share of products for which its applied MFN tariff is equal to (or above) its WTO legal maximum tariff binding.<sup>19</sup> We expect the IRR on this variable to be larger than 1 so that as more imported products 17 During the revision process, we became aware of a paper by Davis and Pelc (2012) that examines related questions on product-level data at the annual frequency for a heterogeneous sample of industrialized and developing economies for 1997-2009. Over this sample period, the authors present evidence consistent with the idea that countries may be less likely to impose protection against partners undergoing a _simultaneous_ contraction. While we present evidence of a similar result for the period covering the Great Recession in section 4.2 below, here we examine whether such a relationship existed in the pre-Great Recession period. As column (6) indicates, we fail to find evidence of this relationship in data from _prior to_ the Great Recession; i.e., countries were no more or less likely to impose new bilateral import restrictions during a domestic downturn if that was synchronized with the trading partner’s downturn.

18 We anticipate that this issue does not matter much across these particular industrialized economies as they each have applied MFN tariff rates relatively close to their WTO tariff bindings. By design, this institutional similarity influenced the focus of this paper to these five policy-imposing economies. Put differently, one contributing explanation as to why we deliberately chose not to include a number of emerging economies in the empirical analysis is because there is substantial variation across those countries, products, and time as to the extent to which WTO commitments discipline their trade policies. We speculate that a much more serious treatment of the choice set of available trade policy instruments is required to analyze the impact of macroeconomic shocks on the import protection for such policy-imposing countries; thus we leave it to future research.

19 The variable is constructed from HS-06 data on WTO maximum tariff bindings and applied MFN tariffs deriving from WITS; the data are available from only 1995-2010. Note that we define this variable as equal to _or above_ (as opposed to simply equal to) because the early WTO period involved many of these economies phasing in reductions to their applied tariffs to levels that were only eventually at or below their bindings. We have also considered other modifications to the definition of this variable – e.g., defining it more flexibly as a product’s applied tariff being within a 1, 5 or 10 percentage point cutoff of the binding – and we obtain similar results. One key drawback to this variable worth noting is that data availability is limited to the _annual_ frequency. This 14