Inequity Aversion and the International Distribution of Trade Protection

Xiaobo Lü, Kenneth Scheve and Matthew J. Slaughter

American Journal of Political Science, 2012, vol. 56, issue 3, 638-654

Abstract: One important puzzle in international political economy is why lower‐earning and less‐skilled intensive industries tend to receive relatively high levels of trade protection. This pattern of protection holds across countries with vastly different economic and political characteristics and is not well accounted for in existing political economy models. We propose and model one possible explanation: that individual inequity aversion leads to systematic differences in support for trade protection across industries. We conduct original survey experiments in China and the United States and provide strong evidence that individual policy opinions about sector‐specific trade protection depend on the earnings of workers in the sector. We also present structural estimates that advantageous and disadvantageous inequality influence support for trade protection in the two countries.

Date: 2012
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https://doi.org/10.1111/j.1540-5907.2012.00589.x

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Persistent link: https://EconPapers.repec.org/RePEc:wly:amposc:v:56:y:2012:i:3:p:638-654

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