Cheap Talk or Circuit to the Legislature: Why Do Corporations Express Public Support for and Opposition Against Free Trade?

Dahyun Choi (Princeton University)

Abstract: Studies of lobbying demonstrate that sending costly signals can further enhance the credibility of the information conveyed by firms, and this characteristic of lobbying has made scholars assume that entering into the lobbying market is the most effective channel for firms to influence policy decisions. However, in reality, firms tend to express public support for or opposition against trade policy more than entering the lobbying markets. By collecting firm-level support and opposition data from congressional hearings and firms' websites, I analyze a systematic pattern of expressing public support for or opposition against free trade agreements. My analysis suggests that firms who oppose free trade are more prone to take advantage of the opportunities that will allow them to express their concerns in the public sphere.

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