The Politics of Trade Protection: Evidence from an EU-Mandated Tariff Liberalization in Morocco

Although non-tariff measures (NTMs) have surpassed tariffs as the most prevalent instrument of trade protection globally, our knowledge of what drives these NTMs is extremely limited. This paper sheds light on the political determinants of non-tariff protection using a rich empirical setting in Morocco. Taking advantage of a bilateral EU-Morocco trade agreement that resulted in an across the board tariff cut and a subsequent rise in NTMs, we use a difference-in-differences regression framework to show that sectors with close prior political connections to the royal family received disproportionately higher levels of non-tariff protection than unconnected sectors. We also demonstrate that, in the wake of the EU-induced tariff cut, connected sectors were mainly compensated through technical barriers to trade that depend on administrative oversight and are vulnerable to political influence.