Trade policy preferences and factor abundance

Ina C. Jäkel and Marcel Smolka

Journal of International Economics, 2017, vol. 106, issue C, 1-19

Abstract: This paper provides a theoretical and empirical analysis of public opinion towards free trade, investigating cleavages both between and within countries. We study the distributional effects of trade policy in a neoclassical Heckscher-Ohlin economy with not just two, but many input factors in production. We demonstrate that the factor price changes induced by trade policy are negatively associated with the factor content of free trade (and therefore factor abundance). Using large-scale international survey data, we test whether these predicted distributional effects are reflected in the trade policy preferences of workers with different labor market skills. In order to isolate the effects of factor abundance from other skill-related confounding factors, we employ a within-skill-group estimator that exploits the cross-country variation in factor abundance. In line with theory, the data show that individuals whose skills are in more abundant domestic supply have significantly more positive attitudes towards trade.

Keywords: Trade policy preferences; Neoclassical trade theory; Survey data (search for similar items in EconPapers)
JEL-codes: F11 F13 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0022199616301660
Full text for ScienceDirect subscribers only

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:eee:inecon:v:106:y:2017:i:c:p:1-19

DOI: 10.1016/j.jinteco.2016.12.006

Access Statistics for this article

Journal of International Economics is currently edited by Gourinchas, Pierre-Olivier and Rodríguez-Clare, Andrés

More articles in Journal of International Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().