Politically Motivated Trade Protection

Chad P. Bown (), Paola Conconi (), Aksel Erbahar () and Lorenzo Trimarchi ()
Additional contact information
Chad P. Bown: Peterson Institute and Centre for Economic Policy Research
Paola Conconi: Oxford University
Aksel Erbahar: Erasmus University Rotterdam and Tinbergen Institute
Lorenzo Trimarchi: Université de Namur

No 729, ADB Economics Working Paper Series from Asian Development Bank

Abstract: This paper shows that the Electoral College system used to elect presidents of the United States (US) distorts US federal policies in favor of key industries in swing states. Using detailed data on US trade policies during the past few decades, we find that the level of trade protection granted to an industry during a presidential term depends on its importance in expected swing states in elections at the end of that term. Crucially, swing-state politics only matters during first terms, when the incumbent president can be reelected. We next examine the effects of politically motivated trade protection, exploiting exogenous changes in the identity of swing states across terms and heterogeneous exposure to these political shocks across industries. We find that swing-state politics generates winners and losers: it fosters growth in protected industries, but hampers growth in downstream industries.

Keywords: Electoral College; swing states; trade protection; supply chains (search for similar items in EconPapers)
JEL-codes: D72 D78 F13 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2024-06-18
New Economics Papers: this item is included in nep-int and nep-pol
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.adb.org/publications/politically-motivated-trade-protection Full text (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:adbewp:0729

Access Statistics for this paper

More papers in ADB Economics Working Paper Series from Asian Development Bank 6 ADB Avenue, Mandaluyong City, 1550 Metro Manila, Philippines. Contact information at EDIRC.
Bibliographic data for series maintained by Orlee Velarde ().