Essays on Local Impact of International Trade.

Abstract

In my dissertation I study how changes in international trade policies affect economic or institutional outcomes. I focus on local geographical regions as the unit of analysis, and analyze the variation of economic and other characteristics of sub-regions within a country to explain the potential effect of economic shocks.

Chapter 1 analyzes the distributional welfare effects of trade policies by focusing on the potential effects of Trans-Pacific Partnership tariff reductions on welfare of U.S. states. I compute the welfare predictions using a standard international trade model that includes data on a sample of countries and U.S. states.

Chapter 2 examines the effect of international trade on skill premium using an international trade model suitable for local geographies, local level data and multiple skills or tasks in the production process as factors. I split the labor force into three groups with low-skilled, medium-skilled, and high-skilled workers using data on earnings and employment by occupation, industry and geography.

Chapter 3 studies how exposure to international trade affects political opinions for secessionism. I focus on the Catalan independence movement and test whether sub-regions of Catalonia that specialize in sectors that are more open to international trade with low trade volumes with the rest of Spain are more likely to exhibit higher stances for secession from Spain. I use an international trade model and treat secession of Catalonia from Spain as if it is a negative trade policy shock that increases trade costs between Catalonia and Spain. I find that moving from a municipality that is at the 25th percentile of negative exposure value to a municipality around the 75th percentile exposure increases independence opinions for secession by 9.2 percentage points in terms of vote share.