Working Paper: Examining the Role of Consumer Preferences on U.S. Individuals’ Trade Policy Views

Abstract

This paper analyzes the role of U.S. consumers’ preferences, along with other potential determinants indicated by international trade theories, on citizens’ trade policy views in 2016. Specifically, it examines the association between U.S. individual- and household-level consumption and citizens’ perception of trade policy, in particular, whether additional import restrictions should be placed by the United States on foreign products. I hypothesize that individuals whose consumption bundles largely consist of globally-imported goods are less likely to favor additional import restrictions. A binary response model is used to estimate the marginal effect of each potential factor associated with trade policy views. My empirical findings suggest that a higher expenditure-weighted import penetration ratio and a higher expenditure-weighted applied tariff rate are both associated with a lower likelihood of support for additional import restrictions.