Trade Wars and Election Interference

Brutger, Ryan; Chaudoin, Stephen; Kagan, Max

doi:10.1007/s11558-022-09464-2

Cited by 13 publications

(8 citation statements)

References 35 publications

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“…For one, it is costly, for another, it was novel. Brutger et al (2023) argue that politically-targeted trade retaliation risks backfiring as both Republicans and Democrats see the use of tariffs as a form of election interference. Whether the same is true of excessive compensation remains to be seen, as the use of public funds to incidentally benefit politically is acceptable, but to do so systematically may draw the voters' ire.…”

Section: Discussionmentioning

confidence: 99%

“…Domestically, program funds were allocated on the basis of planting decisions made prior to the trade conflict, but the overall level of funding and product composition may have been designed to address electoral and economic priorities of the Trump Administration (Jares & Malhotra, 2023). Internationally, foreign governments have used retaliatory tariffs in a way to raise the electoral cost of US protection, in this case, the US tariffs on steel, aluminum, and other products (Brutger et al, 2023;Kim & Margalit, 2021). Both introduce an identification challenge, as compensatory funds flow to electorally valuable communities.…”

Section: Introductionmentioning

confidence: 99%

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The Political Benefits of the Monoculture: Estimating the Electoral Effect of the Market Facilitation Program

Gulotty,

Strezhnev

2024

Preprint

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Does the distribution of government transfers affect elections? To answer this question, we analyze a natural experiment in the design of the US Department of Agriculture's Market Facilitation Program (MFP) prior to the 2020 Presidential elections. The 2019 wave of the program allocated roughly \$14 billion to US agricultural producers according to a formula that combined objective measurements of production and product-specific trade damage estimates. While the former are potentially confounded with political dynamics, the latter were driven by arbitrary, random volatility in historical US exports. Given this known assignment process, we reconstruct the formula with public and internal USDA county and crop-level data to show how product-specific trade shocks propagated into county-specific compensation rates and payments. We use a randomization inference approach that permutes these shocks to obtain valid, design-based, finite-sample inferences even in the presence of complex dependencies in shock exposure across U.S. counties. Further adjusting for demographics and political trends, we find that counties receiving greater compensation rates, on average, have higher Republican Party presidential vote shares in the 2020 election. Instrumenting for actual MFP disbursements in 2019-2020 using our measure of excess compensation, we estimate that an additional \$10 million in 2019 MFP payments to a county increased that county's 2020 two-party Trump vote share by about 1.8 percentage points on average. We find no effect of the instrument on 2018 MFP payments, suggesting that our finding is attributable to formula changes rather than agricultural payments in general.

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Section: Discussionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

The Political Benefits of the Monoculture: Estimating the Electoral Effect of the Market Facilitation Program

Gulotty,

Strezhnev

2024

Preprint

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“…As tariffs soared, tariffs on Chinese goods were increased up to 21% and still remain high at approximately trade as a foreign policy issue 19% as of January 2021 . These tariffs, in combination with the retaliatory tariffs emanating in response from China, have severe economic and political consequences Brutger et al, 2023). Strikingly, whilst the trade confrontation with European powers seems to have diminished, the tariffs targeting China continue to be upheld under the new Biden administration (The Economist, 2021).…”

Section: A Bilateral Approach To Trade Attitudesmentioning

confidence: 99%

“…The unilateral increase of tariffs on a range of Chinese goods by the for mer U.S. Trump administration in 2018 fundamentally threatens open-economy politics. By initiating a trade war with China, the U.S. elevation of tariffs has had important political, as well as economic, repercussions Brutger et al, 2023). The unilateral tariff increase also scathes the multilateral trading system as the U.S. prioritized aggressive protectionism rather than abiding by WTO principles.…”

Section: Introductionmentioning

confidence: 99%

China and the WTO

2023

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Examining the twenty years since China acceded to the World Trade Organization, this collection provides an original, systematic assessment of the opportunities and challenges that China has presented to the WTO. Offering in-depth analyses of the 'two-way' relationship between China and the WTO, the contributions explore a range of key issues from the varied effects of WTO membership for China and the global economy to the responses of the WTO members to China's rapid economic growth. It presents diverse perspectives of leading scholars from multiple disciplines, including law, economics, political science, and international relations, as well as practical insights from senior policymakers from both China and the United States. This is an invaluable contribution to ongoing debates about the implications of the rise of China for global economic governance and enriches discussions of the wide-ranging implications of China's growing integration into the multilateral trading system, both now and in the future. This title is also available as Open Access on Cambridge Core.

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“…Unlike those 2 Fetzer and Schwarz (2021) investigated the degree to which retaliation by the USA's trade partners was politically targeted and documented that retaliatory tariffs were targeted toward areas that supported Trump in the 2016 election. Brutger et al (2021) used the concept of politically targeted trade retaliation (PTTR) and found that PTTR, enacted by many countries during the Trump trade war, increased fears of election interference in the US.…”

Section: Introductionmentioning

confidence: 99%

Tariffs, agricultural subsidies, and the 2020 US presidential election

Choi

Lim

2022

American J Agri Economics

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This paper provides evidence on the effects of US and Chinese trade policies on the 2020 US presidential election. In response to a series of US tariffs imposed on Chinese goods, China imposed retaliatory tariffs, especially on US agricultural products, which largely affected Republican-leaning counties. The US government then subsidized US farmers by providing direct payments through the Market Facilitation Program (MFP) to mitigate the Chinese retaliatory tariffs. Using the universe of actual county-level MFP disbursement data, we first document that US agricultural subsidies relative to the Chinese retaliatory tariff exposure were especially higher in solidly Republican counties, implying that Trump allocated rents in exchange for political patronage. Then, we find that US agricultural subsidies outweighed Chinese retaliatory tariffs and led to an increase in the Republican vote share in the 2020 presidential election. Finally, we uncover evidence that China's retaliatory trade policy and US agricultural policy exacerbated political polarization in the US, especially the rural-urban divide.

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Trade Wars and Election Interference

Cited by 13 publications

References 35 publications

The Political Benefits of the Monoculture: Estimating the Electoral Effect of the Market Facilitation Program

The Political Benefits of the Monoculture: Estimating the Electoral Effect of the Market Facilitation Program

China and the WTO

Tariffs, agricultural subsidies, and the 2020 US presidential election

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