Analyzing the Micro-foundations of the Anti-Trade Backlash

Session Submission Type: Full Paper Panel

Session Description

The Trump administration's tough rhetoric against free trade has been accompanied by an apparent surge of populist support for protectionism. Outside the United States, nationalist parties have garnered widespread support among the public, riding the tide of anti-globalization sentiment. The prevailing anti-trade backlash prompts some of the enduring questions in the international political economy scholarship about the microfoundations of trade policy preferences among individuals and groups in the society. Namely, can standard political economy theories be used to explain the resurgence of protectionism among voters? What factors cause (the resurgence of) trade protectionism in voters? What is the role played by multinational firms in the rise of protectionism? What are their implications on international relations? Our proposed panel spans four diverse papers that re-examine these questions in greater depth with novel analytic and empirical approaches.

In “Institutional Design, Information Transmission, and Public Opinion: Making the Case for Trade,” Ryan Brutger and Siyao Li study how international organizations can shape the preferences of the domestic public towards international trade agreements. Using a survey experiment in the U.S., the authors find that institutional features of international organizations inform voters’ opinions toward a trade deal. In “Power Asymmetry, Blame Assignment and Backlash Against Free Trade: Experimental Evidence from the United States and Japan,” Megumi Naoi investigates why powerful states tend to face stronger domestic opposition to trade negotiations. In survey experiments in the United States and Japan, Naoi finds that backlash against trade negotiations is likely stronger in powerful countries where voters perceive their own governments to have greater ability to obtain compensations for the losers of trade liberalization. Shifting gears, in “The Politics of Reshoring,” Jieun Lee and Iain Osgood examines the factors that shape the preferences of multinational firms toward protectionist trade policy by focusing on the development of global networks of sourcing and production. The authors uncover corporate strategies against anti-trade backlash among the mass public by documenting firms’ efforts to fight steel tariffs, withdrawal from NAFTA, and tariffs on Chinese imports. Finally, in “Anti-Trade Despite Economic Self-Interest: Heterogeneous Effects of Uncertainty on Trade Policy Preferences,” In Young Park presents a formal theory of why some voters become trade protectionist when, according to standard trade models, higher tariffs harm their own economic interests. Contrary to recent claims, her model shows that other-regarding tendencies or cognitive biases influence economic policy preferences only to the extent they inform beliefs about uncertain future shocks to economic self-interest.

Sub Unit

• DIVISION 16: International Political Economy

Chair

• Jeffry A. Frieden Harvard University

Discussants

• Kenneth F. Scheve Stanford University

• Robert Gulotty The University of Chicago

Individual Presentations

• Institutional Design, Information Transmission, and Public Opinion - Ryan Brutger, University of Pennsylvania; Siyao Li, University of Pennsylvania

• Power Asymmetry, Blame Assignment and Backlash Against Free Trade - Megumi Naoi, University of California, San Diego

• The Politics of Reshoring - Jieun Lee, University of Michigan; Iain Osgood, University of Michigan, Ann Arbor

• Anti-Trade Despite Economic Self-Interest - In Young Park, Princeton University