Taking Gains from Trade Seriously: The Effects of Consumer Perspective on Free Trade

Yu Jin Woo () and Ikuo Kume ()
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Yu Jin Woo: Waseda Institute of Political Economy, Waseda University
Ikuo Kume: School of Political Science and Economics, Waseda University

No 2020, Working Papers from Waseda University, Faculty of Political Science and Economics

Abstract: Why do people’s preferences toward trade liberalization fluctuate? And why do we observe eventual return of public support toward free trade? The traditional literature on international political economy has typically calculated individuals’ preferences based on their comparative advantage as producers, which arises from their specific or general skill level or employment status. What needs to be taken into account, however, is that their economic preferences are constructed based upon their intertwined identities as both producers and consumers. Using a unique survey design, we conduct an experiment in Japan (2015) that shows that consumer priming resiliently offsets negative impacts arising from employment priming. The consumer effect reduces individuals’ concerns on income level or employment when they are exposed to consumer and employment primings simultaneously. Furthermore, our subgroup analyses reveal that the consumer effect remains powerful even for low-income earners or those exposed to high levels of job insecurity.

Keywords: Trade liberalization; consumer perspective; income-earner perspective; survey experiment; Japan (search for similar items in EconPapers)
Pages: 40 pages
Date: 2021-03
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (1)

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