Political Costs of Trade War Tariffs

Abstract

We analyze whether--and, if so, how--Americans reacted to the escalation of the trade war between the United States and China in June 2018. To address this issue, we leverage surveys conducted in the U.S. during this phase of the economic clash. We find a significant reduction in support for Donald Trump and his trade policy immediately following the announcement of retaliatory tariffs by the Chinese government. Moreover, respondents’ economic concerns about the trade war were primarily sociotropic and only weakly related to personal pocketbook considerations or local exposure to Chinese retaliatory tariffs. We also find that the trade war's intensification was politically consequential, decreasing support for Republican candidates in the 2018 midterm elections. Our findings indicate that trade wars can be politically costly for incumbent politicians, even among voters who are not directly affected by retaliatory tariffs.

Keywords: trade war, Trump Administration, U.S.-China relations, presidential approval, U.S. midterm elections