Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure

Income Distribution, New Findings, December 2016

Has ris­ing trade inte­gra­tion between the U.S. and China con­tributed to the polar­iza­tion of U.S. politics? Analyzing out­comes from the 2002 and 2010 con­gres­sional elec­tions, authors David Autor, David Dorn, Gordon Hanson, and Kaveh Majlesi detect an ide­o­log­i­cal realign­ment that is cen­tered in trade-exposed local labor mar­kets and that com­mences prior to the divi­sive 2016 U.S. pres­i­den­tial elec­tion. Exploiting the exoge­nous com­po­nent of ris­ing trade with China and clas­si­fy­ing leg­is­la­tor ide­olo­gies by their con­gres­sional vot­ing record, they find strong evi­dence that con­gres­sional dis­tricts exposed to larger increases in import com­pe­ti­tion dis­pro­por­tion­ately removed mod­er­ate rep­re­sen­ta­tives from office in the 2000s. Trade-exposed dis­tricts ini­tially in Republican hands become sub­stan­tially more likely to elect a con­ser­v­a­tive Republican, while trade-exposed dis­tricts ini­tially in Democratic hands become more likely to elect either a lib­eral Democrat or a con­ser­v­a­tive Republican. Polarization is also evi­dent when break­ing down dis­tricts by race: trade-exposed loca­tions with a major­ity white pop­u­la­tion are dis­pro­por­tion­ately likely to replace mod­er­ate leg­is­la­tors with con­ser­v­a­tive Republicans, whereas loca­tions with a major­ity non-white pop­u­la­tion tend to replace mod­er­ates with lib­eral Democrats. The authors fur­ther con­trast the elec­toral impacts of trade expo­sure with shocks asso­ci­ated with gen­er­al­ized changes in labor demand and with the post-2006 U.S. hous­ing market collapse.