Heckscher-Ohlin Theory and Individual Attitudes Towards GlobalisationInternational Financial Integration

Kevin O'Rourke

Economic Papers from Trinity College Dublin, Economics Department

Abstract: The aim of the paper is to see whether individuals' attitudes towards globalisation are consistent with the predictions of Heckscher-Ohlin theory. The theory predicts that the impact of being skilled or unskilled on attitudes towards trade and immigration should depend on a country's skill endowments, with the skilled being less anti-trade and anti-immigration in more skill-abundant countries (here taken to be richer countries) than in more unskilled-labour-abundant countries (here taken to be poorer countries). These predictions are confirmed, using survey data for 24 countries. The high-skilled are pro-globalisation in rich countries; while in some of the very poorest countries in the sample being high-skilled has a negative (if statistically insignificant) impact on pro-globalisation sentiment. More generally, an interaction term between skills and GDP per capita has a negative impact in regressions explaining anti-globalisation sentiment. Furthermore, individuals view protectionism and anti-immigration policies as complements rather than as substitutes, as they would do in a simple Heckscher-Ohlin world.

Date: 2003
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