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The Effect of Trade on Workers and Voters

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  • Christian Dippel
  • Robert Gold
  • Stephan Heblich
  • Rodrigo Pinto

Abstract

We investigate economic causes of the rising support of populist parties in industrialised countries. Looking at Germany, we find that exposure to imports from low-wage countries increases the support for nationalist parties between 1987–2009, while increasing exports have the opposite effect. The net effect translates into increasing support of the right-populist Alternative for Germany party after its emergence in 2013. Individual data from the German Socio-Economic Panel reveal that low-skilled manufacturing workers’ political preferences are most responsive to trade exposure. Using a novel approach to causal mediation analysis, we identify trade-induced labour market adjustments as an economic mechanism causing the voting response to international trade.

Suggested Citation

  • Christian Dippel & Robert Gold & Stephan Heblich & Rodrigo Pinto, 2022. "The Effect of Trade on Workers and Voters," The Economic Journal, Royal Economic Society, vol. 132(641), pages 199-217.
    • Handle: RePEc:oup:econjl:v:132:y:2022:i:641:p:199-217.
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    File URL: http://hdl.handle.net/10.1093/ej/ueab041
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