France and Great Britain signed the Cobden Chevalier treaty in 1860 eliminating import prohibitions and lowering tariffs with Britain. This policy change was unexpected by French industry and entirely free from lobbying efforts. A series of commercial treaties with other nations followed in the 1860s lowering tariffs with France's largest trade partners. We study the dynamics of French trade patterns using product level exports and imports for France with all partners and at the bilateral level before and after these tectonic trade policy shocks. We find a significant rise in intra-industry trade in leading manufactured products. Cotton, woolen and silk cloth "held their ground," rising imports being met with rising exports. Rather than shifting or destabilizing French patterns of specialization, liberalization allowed for an expansion of exports in differentiated products. The findings are consistent with the "smooth adjustment" hypothesis. The return to discussion of higher tariffs from 1878 should not be regarded as a backlash to international competition, but rather the outcome of anti-competitive protectionist lobbying.
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