Globalization, Government Popularity, and the Great Skill Divide

87 Pages Posted: 23 Mar 2020

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

Abstract

How does international trade affect the popularity of governments and leaders? The recent backlash against globalization renders this question extremely topical. Yet, most previous work has looked for political effects of aggregate trade flows without decomposing into particular types of products. We provide the first large-scale, global evidence that trade shocks affect political approval and show that what matters is the match between workers' skills and the characteristics of goods traded. Using a unique data set including 118 countries, we show that growth in high skill intensive exports increases approval of incumbents among skilled individuals. Growth in high skill intensive imports has the opposite effect. High skill intensive trade has no discernible effect on the unskilled. To identify exogenous variation, we exploit the time-varying effects of air and sea distances on bilateral trade flows. Our findings help explain responses to trade of economic elites in developing and middle income countries.

Keywords: international trade, political approval, 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. IZA Discussion Paper No. 13026, Available at SSRN: https://ssrn.com/abstract=3558324

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
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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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