This paper develops a theory of “quid pro quo” trade preferences in which governments use preferential market access as payment
for non-trade objectives rather than as instruments of traditional commercial policy. Using a new panel data set that links tariff

preferences granted by the United States and the European Union to voting alignment in the UN General Assembly, troop
contributions to multilateral peace-keeping operations, and bilateral migration control efforts, we find that deeper preference margins
are systematically awarded to countries that supply these cooperative public goods. The relationship is strongest in sectors where
the preference-granting country has little import competition, indicating that the exchange is infra-marginal to domestic welfare.
Counter-factual simulations suggest that replacing politically motivated preferences with a uniform MFN tariff would raise welfare in
the preference-granting countries by 0.06 % of GDP, but would reduce cooperative public-good supply by 12–18 %. Our results imply
that trade preferences operate as an efficient, off-budget mechanism for purchasing foreign cooperation, reconciling the apparent
persistence of such policies with standard political-economy explanations.