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Compensating the Losers: Examining policy responses to globalization using congressional roll-call votes

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Compensating the Losers: Examining policy responses to globalization using congressional roll-call votes

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    1. Compensating the Losers: Examining policy responses to globalization using congressional roll-call votes Stephanie Rickard Penn State University 1

    2. Motivation 2

    3. Causally connected? Embedded liberalism (Ruggie 1983) Governments ? spending to compensate trade losers 3

    4. Causally connected? Empirical evidence Macro-level Scheve and Slaughter (2004) Micro-level Hays, Ehrlich, and Peinhardt (2005) Mayda, O’Rourke, and Sinnott (2007) 4

    5. Research question Do governments supply compensation to reduce opposition to trade openness? If so, we should find evidence of this in legislative activity. Roll call votes Congressional Record 5

    6. Research design What would such evidence look like? Legislators from districts with relatively more trade winners will tend to vote for both liberalization and compensation. 6

    7. Vote selection Compensation: Clean, competitive roll-call Senate votes on Trade Adjustment Assistance 7

    8. Vote selection 8

    9. Vote selection Liberalization: Clean, competitive roll-call Senate votes on barriers to trade occurring in the same Congress or the Congress immediately proceeding or following a TAA vote 9

    10. Vote selection 10

    11. 11 Vote selection

    12. Measuring trade winners Stolper-Samuelson SKILL - % of state’s working age population in executive, managerial, administrative and professional occupations. EDUCATION - % of state’s population over 25 years old with 4 or more years of college education. Specific-Factors EXPORTS – % of the state population employed in net export industries. IMPORTS - % of the state population employed in net import industries. 12

    13. Evidence 13 Senators voting for both liberalization and compensation represent state with relatively more trade winners. This is true regardless of how winners are measures. Senators voting for both liberalization and compensation represent state with relatively more trade winners. This is true regardless of how winners are measures.

    14. Evidence Probit analysis of each vote-pair DV coded 1 if legislator voted for both liberalization and compensation; 0 if legislator voted for only liberalization Control for legislator’s party id (coded 1 if Democrat; 0 if Republican) Mixed model of the economy; include both factor-based measure of winners and industry-based measure 14

    15. Evidence 15

    16. Evidence 16

    17. Further evidence From the Congressional Record “It is also critical to note that TAA can make an important difference in public attitudes. Surveys show that most Americans feel a lot more comfortable with globalization, off-shoring, and trade when they know they will get help if their jobs are threatened.” – Senator BAUCUS (D-Montana) speaking in support of a TAA amendment, which he co-sponsored. 17

    18. Further evidence “I am very concerned that if we lose farm support for free trade it will be very hard for us to win congressional support for new trade deals when they are concluded.” Senator Grassley (R-Iowa) speaking in support of extending TAA to agriculture. “The Trade Adjustment Assistance Programs, which was an amendment that was added to the fast-track promotion bill – maybe to encourage some people to vote for it,” Senator Nickles (R-Oklahoma) 18

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