DP11511 Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure
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, we 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, we 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. We 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.
