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Government Spending and Public Support for Trade in the OECD: An Empirical Test of the Embedded Liberalism Thesis

Jude C. Hays, Sean D. Ehrlich and Clint Peinhardt
International Organization
Vol. 59, No. 2 (Spring, 2005), pp. 473-494
Stable URL: http://www.jstor.org/stable/3877913
Page Count: 22
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Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Government Spending and Public Support for Trade in the OECD: An Empirical Test of the Embedded Liberalism Thesis
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Abstract

According to the embedded liberalism thesis, governments committed to free trade provide insurance and other transfers to compensate those who lose economically from expanded trade. The goal of this spending is to maintain public support for trade liberalization. We provide a micro-level test of the critical assumption behind the embedded liberalism thesis that government programs designed to protect individuals harmed by imports reduce opposition to free trade. Our micro results have important implications for the macro relationship between trade and government spending, which we also test. We find empirical support for the embedded liberalism thesis in both our micro- and macro-level analyses.

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