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Abstract
The paper tests a political economy theory of simultaneous government decision-making on income redistribution through
commodity policies and on public research investment in agriculture. We use data from 37 countries on agricultural protection
and public agricultural research expenditures (PARI). The empirical results are consistent with the political economy
hypotheses. The analysis suggest that structural changes in the economy have important effects on the political incentives for
governments not only to subsidize or tax farmers, but also to invest in public agricultural research. Furthermore, the analysis
supports the hypotheses that the impact of such structural changes on government decision-making on PARl is non-linear and
conditional on other factors. Regarding the impact of political institutions, the results suggest that more democracy neither
leads to more distortionary transfers (agricultural protection), nor to lower investment in public goods (PARI). © 2000
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