Trade Competition and Worker Compensation: Why Do Some Receive More than Others?

Sung Eun Kim, Krzysztof J. Pelc

Research output: Contribution to journalArticlepeer-review

Abstract

Dealing with the distributional consequences of trade liberalization has become one of the key challenges facing developed democracies. Governments have created compensation programs to ease labor market adjustment, but these resources tend to be distributed highly unevenly. What accounts for the variation? Looking at the largest trade adjustment program in existence, the US' Trade Adjustment Assistance (TAA), we argue that petitions for compensation are largely driven by legislative attitudes. When legislators express negative views of TAA, individuals in their districts become less likely to petition for, and receive, compensation. This effect is especially pronounced in Republican districts. An underprovision of TAA, in turn, renders individuals more likely to demand other forms of government support, like in-kind medical benefits. We use roll-call votes, bill sponsorships, and floor speeches to measure elite attitudes, and we proxy for the demand for trade adjustment using economic shocks from Chinese import competition. In sum, we show how the individual beliefs of political elites can be self-fulfilling.

Original languageEnglish
Pages (from-to)109-121
Number of pages13
JournalInternational Studies Quarterly
Volume65
Issue number1
DOIs
Publication statusPublished - 2021 Mar 1

ASJC Scopus subject areas

  • Sociology and Political Science
  • Political Science and International Relations

Fingerprint

Dive into the research topics of 'Trade Competition and Worker Compensation: Why Do Some Receive More than Others?'. Together they form a unique fingerprint.

Cite this