Heckscher-Ohlin Theory and Individual Attitudes Towards Globalization

Kevin O'Rourke

NBER Working Paper No. 9872
Issued in July 2003
NBER Program(s):   ITI

The aim of the paper is to see whether individuals' attitudes towards globalization are consistent with the predictions of Heckscher-Ohlin theory. The theory predicts that the impact of being skilled or unskilled on attitudes towards trade and immigration should depend on a country's skill endowments, with the skilled being less anti-trade and anti-immigration in more skill-abundant countries (here taken to be richer countries) than in more unskilled-labour-abundant countries (here taken to be poorer countries). These predictions are confirmed, using survey data for 24 countries. Being high-skilled is associated with more pro-globalization attitudes in rich countries; while in some of the very poorest countries in the sample being high-skilled has a negative (if statistically insignificant) impact on pro-globalization sentiment. More generally, an interaction term between skills and GDP per capita has a negative impact in regressions explaining anti-globalization sentiment. Furthermore, individuals view protectionism and anti-immigrant policies as complements rather than as substitutes, which is what simple Heckscher-Ohlin theory predicts.

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Published: Findlay, R., R. Henriksson, H. Lindgren and M. Lundahl (eds.) Eli Heckscher, International Trade, and Economic History. MIT Press, 2006.

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