Domestic Politics of Trade Wars: Evidence from a Field Experiment on U.S. Firms

• In Event: Politics of the U.S.-China Trade War

Abstract

Why have some U.S. businesses reacted strongly to the ongoing trade war, while other companies have not? We conduct a novel field experiment on managers at U.S.-based firms to better understand their experience of the trade war and their propensity for political action. We contacted over 100,000 firms through emailing registered firms in Orbis, Facebook sampling, a purchased list of managers, and partnership with the Kansas City Chamber of Commerce to collect a national sample of over 1200 firm managers. We measure whether firms are more likely to seek tariff relief through political action (joining a social media campaign, signing a petition, writing to their representative in Congress, seeking tariff exemptions, or donating to politicians opposed to the trade war) after we treat them with information about the economic cost of recent tariff increases to their business and industry. We also survey these firms to assess their attitudes towards the trade war and obtain firm-level characteristics not available from Orbis (ex. whether they belong to industry associations) and track browsing behavior on a website we built for the study. We are interested in the heterogeneous treatment effect of economic information on how different types of firms choose to engage in collective action. This study extends the vast IPE literature on individual trade attitudes and behaviors to firms. Fielded from June 2019 to November 2020, this is the timely study of firm-level behavior to the highly salient issue of the trade war and provides valuable data to test other IPE theories about the formation of firm-and industry-level cleavages.

Authors

• Lindsay R. Dolan, Wesleyan University

• Robert Kubinec, Princeton University

• Daniel L. Nielson, University of Texas at Austin

• Jiakun Zhang, University of Kansas