Commerce, Coalitions, and Global Value Chains: Coordinated and Collective Lobbying on Trade

67 Pages Posted: 2 Aug 2023 Last revised: 2 Jul 2024

Date Written: July 31, 2023

Abstract

Global value chains (GVCs) have connected firms in complex networks within and across national borders. However, political economy models often assume away production linkages and thus fail to explain pervasive and diverse trade coalitions cutting across industries and firms. I develop a GVC-centered framework where production linkages through the common foreign partner foster interdependent preferences and collective action for trade liberalization. For empirical tests, I compile firm-to-firm supply chain datasets, construct direct measures, and estimate various network models. I find that US firms with GVC linkages tend to lobby together, lobby on the same bill, and hire the same lobbyist. Furthermore, GVC linkages among lead firms increase collective lobbying through trade associations. Finally, I show that GVC linkages predict the formation and depth of preferential trade networks. These results provide microfoundations for new coalitional politics under GVCs and challenge the common assumption about industries and firms as isolated political actors.

Keywords: global value chain, trade coalition, trade politics, preferential trade liberalization

Suggested Citation

Zhang, Hao, Commerce, Coalitions, and Global Value Chains: Coordinated and Collective Lobbying on Trade (July 31, 2023). MIT Political Science Department Research Paper No. 2023-7, Available at SSRN: https://ssrn.com/abstract=4527143 or http://dx.doi.org/10.2139/ssrn.4527143

Hao Zhang (Contact Author)

Princeton University ( email )

Princeton, NJ 08540
United States
6173356101 (Phone)

HOME PAGE: http://haocharliezhang.com

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