Costly Jobs: Trade-related Layoffs, Government Compensation, and Voting in U.S. Elections
Abstract
Does globalization's impact on the labor market affect how people vote? I address this question using a new dataset based on plant-level data that measures the impact of foreign competition on the U.S. workforce over an 8-year period. Analyzing change in the president's vote share, I find that voters were substantially more sensitive to the loss of local jobs when it resulted from foreign competition, particularly from offshoring, than to job losses caused by other factors. Yet, I also find that between 2000 and 2004, the anti-incumbent effect of trade-related job losses was smaller in areas where the government certified more of the harmed workers to receive special job training and income assistance. The findings have implications for understanding the impact of international economic integration on voting behavior, as well as for assessing the electoral effect of government programs designed to compensate the losers from globalization.
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The concentrated impact of the China shock on specific industries and regions makes the economic consequences of trade acutely recognizable and therefore politically salient.
“The concentrated impact of the China shock on specific industries and regions makes the economic consequences of trade acutely recognizable and therefore politically salient (Margalit 2011; Di Tella and Rodrik 2019).”
From Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure (2020) · cites this paper as Margalit 2011
The combination of these features enhances the salience of the labor-market impacts of trade and therefore their political resonance.
“The combination of these features enhances the salience of the labor-market impacts of trade and therefore their political resonance (Margalit 2011).”
From Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure (2020) · cites this paper as Margalit 2011
Cites
Trading Tasks: A Simple Theory of Offshoring
Grossman, G. M., & Rossi-Hansberg, E. (2008) · American Economic Review · doi:10.1257/aer.98.5.1978 · Cited by 2,262 · cited 2× · see citing works
“In addition, offshoring could adversely affect workers whose jobs are not outsourced by suppressing wages of certain low-skilled sectors in large economies (Grossman and Rossi-Hansberg 2008).”
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Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure
Autor, D., Dorn, D., Hanson, G., & Majlesi, K. (2020) · American Economic Review · doi:10.1257/aer.20170011 · Cited by 1,063 · see citing works
How Legislators Respond to Localized Economic Shocks: Evidence from Chinese Import Competition
Feigenbaum, J. J., & Hall, A. B. (2015) · The Journal of Politics · doi:10.1086/682151 · Cited by 178 · see citing works
- Authors
- MARGALIT, Y.
- Affiliations
- Columbia University (US)
- Corresponding author
- MARGALIT, YOTAM
- ORCID
- MARGALIT, YOTAM
- Venue
- American Political Science Review
- Publisher
- Cambridge University Press (CUP)
- Published
- 2011-02
- Volume
- 105
- Issue
- 1
- Pages
- 166-188
- ISSN
- 0003-0554 (ISSN-L)
- 1537-5943
- OpenAlex
- W2056082099
- Cited by
- 273
- References
- 1
- Citations by year
- 2026: 14 · 2025: 23 · 2024: 24 · 2023: 23 · 2022: 35 · 2021: 22 · 2020: 29 · 2019: 28 · 2018: 23 · 2017: 16 · 2016: 10 · 2015: 4 · 2014: 8 · 2013: 11 · 2012: 3
- FWCI
- 48.56
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- American Political Science Review (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Topics
- Social Sciences › Political Science and International Relations › Electoral Systems and Political Participation
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Global trade and economics
- Social Sciences › Political Science and International Relations › Social Policy and Reform Studies
- Keywords
- offshoring, import competition, voting behavior, unemployment insurance, income support, globalization, international economic integration, plant-level data, labor market effects of trade
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