Labour Market Shocks and the Demand for Trade Protection: Evidence from Online Surveys

A-Tier
Journal: Economic Journal
Year: 2020
Volume: 130
Issue: 628
Pages: 1008-1030

Authors (2)

Rafael Di Tella (not in RePEc) Dani Rodrik (Harvard University)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We study preferences for government action in response to layoffs resulting from different types of labour-market shocks. We consider: technological change, a demand shift, bad management and three kinds of international outsourcing. Support for government intervention rises sharply in response to shocks and is heavily biased towards trade protection. Trade shocks generate more demand for protectionism and, among trade shocks, outsourcing to a developing country elicits greater demand for protectionism. The 'bad management' shock is the only scenario that induces a desired increase in compensatory transfers. Trump supporters are more protectionist than Clinton supporters, but preferences seem easy to manipulate: Clinton supporters primed with trade shocks are as protectionist as baseline Trump voters. Highlighting labour abuses in the exporting country increases the demand for trade protection by Clinton supporters but not Trump supporters.

Technical Details

RePEc Handle
repec:oup:econjl:v:130:y:2020:i:628:p:1008-1030.
Journal Field
General
Author Count
2
Added to Database
2026-01-29