Does Trade Liberalization with China Influence U.S. Elections?

Abstract

We thank participants at the 2015 NBER China meeting for helpful comments. Any opinions and conclusions expressed herein are those of the authors and do not necessarily represent the views of the Board of Governors, its research staff, or the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w22178.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Salvation by good works? Offshoring, corporate philanthropy, and public attitudes toward trade policy

“…Because offshoring has come to represent those trade patterns (Mankiw & Swagel, ), it may be that sensitivities to it cluster among people who are most exposed to trade‐related disruptions. That would be consistent with a variety of findings relating the “China Shock” to various sorts of political behavior (Autor et al, ; Che, Lu, Pierce, Schott, & Tao, ; Feigenbaum & Hall, ; Kuk, Seligsohn, & Zhang, ).…”

“…The subtlety of our contextual shift is especially close to and resonant with work by Naoi and Kume ( ). Finally, our work also complements work by Che et al (), Feigenbaum and Hall (), Autor et al () and Kuk et al (), all of which find that the China Shock has had substantial political implications, but also that the heterogeneous consequence that the China shock has had on the American labor market has shaped the heterogeneous political responses that have emerged. This paper expands the range of mass political phenomena that trace their roots to the geographic distribution of trade‐related labor market displacement.…”

Employment shocks and anti-EU sentiment

“…They conclude that "employment conse-quences of trade [are] acutely recognizable and therefore politically actionable" (p.45). Similarly, Che et al (2016) show that US counties exposed to import competition from China experience increases in turnout and are more likely to be represented by a Democrat. Colantone and Stanig (2018) examine the effects of import competition on western Europe and also find that import shocks lead to an increase in support for nationalist parties and a general shift to the right in the electorate.…”

Globalization and the Concentration of Talent

“…This has important distributional consequences, as it tends to further increase income inequality in modern societies. Potentially adverse effects of globalization above and beyond a direct effect on income inequality have received increasing attention in recent years (Autor et al, 2014;Che et al, 2016;McManus and Schaur, 2016;Pierce and Schott, 2016). An increased concentration of talent might be an important factor in this regard, as in the presence of learning externalities it may harm low-skilled workers and perpetuate-or even increase-skill differences and, more generally, it contributes to social seggregation.…”