CEO Ideology and Global Trade

Elisabeth Kempf, Mancy Luo and Margarita Tsoutsoura

No 33712, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study how the political ideology of corporate leaders shapes international trade. Exploiting changes in ideological alignment between U.S. firm CEOs and foreign governments around national elections, we show that firms reduce imports from countries whose governments become more ideologically distant from their CEOs, relative to firms whose CEOs become more aligned. Firms whose CEOs become more ideologically distant do not significantly reduce their total imports; instead, they reallocate toward origin countries that are ideologically closer and more expensive to source from. Textual analysis of earnings call transcripts suggests that an important mechanism behind these patterns is a change in CEOs’ perceptions of foreign macroeconomic conditions.

JEL-codes: F1 G41 (search for similar items in EconPapers)
Date: 2025-04
New Economics Papers: this item is included in nep-bec, nep-int and nep-pol
Note: CF ITI POL
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