Universität zu Köln

Barone, Guglielmo and Kreuter, Helena (2021). Low-wage import competition and populist backlash: The case of Italy*. Eur. J. Polit. Econ., 67. NEW YORK: ELSEVIER SCIENCE INC. ISSN 1873-5703

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Abstract

This paper studies empirically the role of trade globalization in shifting the electoral base towards populism. We proxy the trade shock with swiftly rising import competition from China and compare voting patterns at the national parliamentary elections from 1992 to 2013 in about 8000 Italian municipalities differently exposed to the trade shock. We instrument import competition from China with Chinese export flows to other high-income countries and estimate the model in first differences. Our results indicate that trade globalization increases support for populist parties, as well as invalid votes and abstentionism. To rationalize these findings, we offer evidence that import competition worsens local labor market conditions ? higher unemployment, lower income and durable consumption ? and increases inequality. Finally, we point out that local public expenditure may play a role in mitigating the political consequences of the trade shock, arguably because it alleviates economic distress.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Barone, Guglielmo UNSPECIFIED UNSPECIFIED UNSPECIFIED Kreuter, Helena UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-576941
DOI:	10.1016/j.ejpoleco.2020.101970
Journal or Publication Title:	Eur. J. Polit. Econ.
Volume:	67
Date:	2021
Publisher:	ELSEVIER SCIENCE INC
Place of Publication:	NEW YORK
ISSN:	1873-5703
Language:	English
Faculty:	Unspecified
Divisions:	Unspecified
Subjects:	no entry
Uncontrolled Keywords:	Keywords Language EMPLOYMENT; RISE Multiple languages Economics; Political Science Multiple languages
URI:	http://kups.ub.uni-koeln.de/id/eprint/57694