Free Trade with Whom? Ethnocentrism and Attitudes Toward Trade Agreements

• In Event: New Perspectives on Trade Preferences

Abstract

The current populist backlash against globalization is thought to be driven by those who perceive that they have been left behind by globalization. Indeed, the long-standing belief among scholars is that individual attitudes toward free trade can be explained by economic self-interest; that is, whether one stands to gain or lose from trade liberalization. The debate therefore has centered on whether an individual’s industry of employment, broad skill set, or the specific tasks he performs is the best predictor of attitudes toward free trade. Recent scholarship, however, emphasizes a range of non-economic factors that might also shape trade attitudes, including the degree to which one is ethnocentric.

The starting point for this research is that individuals do not have a consistent and uniform view of trade policy. I begin by showing that when asked about various U.S. trade agreements, a majority of Americans support agreements with some trading partners but oppose those with others. These shifting attitudes are unlikely to be driven by informed calculations of the personal economic consequences of one trade agreement versus another. Moreover, holding a broadly ethnocentric worldview cannot explain why one finds it desirable to trade with some foreigners but not others. Instead, I argue that how individuals feel about important trade issues like preferential trade agreements (PTAs) is driven by their general attitudes toward the trading partner and its people. Utilizing a nationwide survey of more than 2,000 Americans, I show that respondents are more likely to support trade agreements with countries they view warmly, but to oppose agreements with countries they view negatively, regardless of any possible economic benefits. Furthermore, individuals – particularly those predisposed toward racial and ethnic stereotypes – are most likely to oppose agreements with countries whose populations are of a different ethnicity.

This research suggests that economic populism has an important non-economic origin. Individuals view globalization in part through an ethnocentric lens, but their attitudes are contingent upon the identity of the trading partner and its “ethnic match” with the respondent. These findings also suggest that question wording alone does not explain the fluctuations we observe across trade surveys. Instead, attitudes toward trade should vary systematically from one partner to the next, while the specific details of a trade agreement are likely to be relatively unimportant. A resulting prediction is that possible future trade deals with the United Kingdom or European Union should gather more public support than similar or even “better” deals with other trading partners.

Author

• Todd Allee, University of Maryland, College Park