Globalization, Government Popularity, and the Great Skill Divide

64 Pages Posted: 18 Jan 2018 Last revised: 23 Sep 2018

See all articles by Cevat Giray Aksoy

Cevat Giray Aksoy

European Bank for Reconstruction and Development; King’s College London; IZA Institute of Labor Economics

Sergei Guriev

Sciences Po; Centre for Economic Policy Research (CEPR)

Daniel Treisman

University of California, Los Angeles (UCLA) - Department of Political Science

Multiple version iconThere are 4 versions of this paper

Date Written: September 12, 2018

Abstract

How does international trade affect the popularity of governments and leaders? We provide the first large-scale, systematic evidence that the divide between skilled and unskilled workers worldwide is producing respective differences in the response of political preferences to trade shocks. Using a unique data set including 105 countries and nearly 450,000 individuals, we find that growth in high skill-intensive exports (of goods and services) increases approval of the incumbent government among skilled individuals relative to approval among unskilled ones. The growth in high skill-intensive imports has the opposite effect. To identify exogenous variation in international trade, we exploit the timevarying effects of air and sea distances in bilateral trade flows. Our findings suggest that the political effects of international trade differ with skill-intensity and that skilled individuals respond differently from their unskilled counterparts to trade shocks.

Keywords: International trade; political approval; political polarization; skill intensity of trade

JEL Classification: D72; F14; G02; P16

Suggested Citation

Aksoy, Cevat Giray and Guriev, Sergei and Treisman, Daniel, Globalization, Government Popularity, and the Great Skill Divide (September 12, 2018). Available at SSRN: https://ssrn.com/abstract=3100721 or http://dx.doi.org/10.2139/ssrn.3100721

Cevat Giray Aksoy (Contact Author)

European Bank for Reconstruction and Development ( email )

One Exchange Square
London EC2A 2JN
United Kingdom

King’s College London ( email )

Aldwych
London, WC2A 2AE
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IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Sergei Guriev

Sciences Po ( email )

27 rue Saint-Guillaume
Paris Cedex 07, 75337
France

HOME PAGE: http://econ.sciences-po.fr/staff/sergei-guriev

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Daniel Treisman

University of California, Los Angeles (UCLA) - Department of Political Science ( email )

405 Hilgard Ave.
3265 Bunche Hall
Los Angeles, CA 90095-1472
United States
650-725-8556 (Phone)
650-723-1687 (Fax)

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