Europe's Malaise Has Origins in Beijing

HIGHER EXPOSURE TO CHINESE IMPORTS TRANSLATES INTO GREATER SUPPORT FOR NATIONALIST PARTIES, ACCORDING TO A STUDY BY ITALO COLANTONE AND PIERO STANIG

Since the 1990s, nationalist and radical right-wing parties have experienced a revival all over Europe. In The Trade Origins of Economic Nationalism: Import Competition and Voting Behavior in Western Europe, Italo Colantone and Piero Stanig, respectively an economist and a political scientist in the Department of Policy Analysis and Public Management at Bocconi, attribute the phenomenon to growth of imports from China. They demonstrate that voting for nationalist and radical right-wing parties is stronger in areas that are more exposed to competition from China.

“We created an index of exposure to Chinese imports for individual areas,” says Colantone. “It takes into account not only the quantity and quality of imported goods, but also the composition of the workforce in the region during the preceding period. Intuitively, imports being equal, the shock is more severe where there is more employment in the manufacturing sector, because a broader portion of the population risks losing their job due to low cost competition from China.”

The analysis, which focuses on the period 1988-2007 (thus before the Great Recession upset all global economies, muddling the causal relationships of many economic phenomena), follows with a disaggregation at a district level of the results of 76 general elections that occurred at the time as well as a content analysis of the programs for the parties on the ballot, to measure their degree of nationalism. Greater exposure to Chinese imports translated into greater support for nationalist parties, a shift towards the right in the electorate and greater success of radical right-wing parties.

“On average, in a region at the 75th percentile of shock from imports,” explains Stanig, “radical right-wing parties receive 0.7% more votes compared to a region at the 25th percentile – a substantial effect if considering that votes for these parties register an average of around 5%. In addition, workers at risk of losing or who have lost their jobs are not the only ones voting for these parties, but all categories of electors are, since it is the survival of entire industrial districts that is threatened.”

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The US financial bubble was also fueled by imports. A study by Julien Sauvagnat
When Chinese competition endangers health. A study by Jèrome Adda
The sense of fear is not enough to explain the new populisms. A study by Massimo Morelli
 

by Fabio Todesco