Examining the Role of Consumer 

Preferences on U.S. Individuals’ Trade 

Policy Views

Lin Shi

Ph.D. Candidate in Economics

American University

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Research Highlights

• Research question:

• Are U.S. consumers’ exposures to international trade associated with their 

trade policy views in 2016?

• Hypothesis:

• Consumers with a higher exposure to imports should be less likely to support 

additional import restrictions. 

• Empirical Findings:

• A higher expenditure-weighted import penetration ratio is associated with a 

lower likelihood of support for additional import restrictions;

• A higher expenditure-weighted applied tariff rate is also associated with a 

lower likelihood of support for additional import restrictions.

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Motivation

• Consumers’ benefits from trade liberalization are often overlooked in 

the political economy literature

• Canonical trade models assume identical and homothetic preferences, 

contrary to reality

• Exploring the heterogeneities in consumption patterns using the CE 

data: 

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Non-homothetic 

preferences

Heterogeneous 

expenditure 

shares

Heterogeneous 

consumption 

exposures to 

trade

Relation to trade 

policy 

preferences?
Data Sources

• Combining the American National Election Studies (ANES) survey 

with CE PUMD survey using statistical matching

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Dataset Interview or Diary 

Survey File

Files Used Relevant 

Information

FMLI Interview survey FMLI161x; 162; 163; 

164; 171

CU-level summary 

expenditures; CUlevel income; CU 

characteristics and 

weights

MTBI Interview survey MTBI161x; 162; 163; 

164; 171

Monthly 

expenditures

FMLD Diary survey FMLD161; 162; 163; 

164

Summary 

expenditures; CUlevel income; CU 

characteristics and 

weights

EXPD Diary survey EXPD161; 162; 163; 

164

Detailed 

expenditure
Why Integrating Data from Both Interview and 

Diary Surveys?

• Interview survey: Large and recurring expenditures that can be 

recalled for a period of three months or longer

• Example: Rent, utilities

• Diary survey: Small, frequently purchased items

• Example: Most food, clothing

• The source selection file identifies the survey source for each UCC 

consumption item

• Integrating data from both surveys provides a comprehensive 

coverage of consumers’ expenditures

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Interview Survey: Months in Scope 

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Quarter 1 (FMLI161x)

Oct 2015 Nov 2015 Dec 2015 Jan 2016 Feb 2016 Mar 2016

0

X 1

X X 2

Quarter 2 (FMLI162)

Jan 2016 Feb 2016 Mar 2016 Apr 2016 May 2016 Jun 2016

X X X 3

X X X 3

X X X 3
Interview Survey: Months in Scope

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Quarter 5 (FMLI171)

Oct 2016 Nov 2016 Dec 2016 Jan 2017 Feb 2017 Mar 2017

X X X 3

X X 2

X 1
Research Design

• Create an HS-UCC-NAICS concordance (product-consumption itemindustry), with HS-level trade data and NAICS-level industry data

• Create: 5-quarter FMLI file; 5-quarter MTBI file; 4-quarter FMLD file; 

4-quarter EXPD file (“append” in Stata)

• Merge the CE source file into both 5-quarter MTBI and 4-quarter 

EXPD files 

• Combine FMLI and MTBI into an Interview file and FMLD and EXPD 

into a Diary file. Calculate the expenditure shares by UCC and 

demographic characteristics for both “I” and “D” surveys separately, 

in two ways:

• Expenditure as a share of total expenditure

• Expenditure as a share of pre-tax income

• Merge the expenditure shares into the concordance. Calculate the 

expenditure-weighted consumption trade exposure measures

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Empirical Strategy

• Replication of Scheve & Slaughter (2001) and Blonigen (2011):

• Contribution to the existing literature:

• Two variables to capture consumers’ exposure to international trade: 

“weighted import penetration ratio” and “weighted applied tariff rate”

• Imputing the ANES respondents’ consumption patterns by matching them to 

consumers in the 2016 CE PUMD survey based on common demographic 

traits

• Average expenditure share as “weight”;

• Statistical matching using cells

• Logit binary response model:

Pr Import Limitsi = 1 πi = πi, and πi =

1

1+e

−βxi

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Summary Statistics

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The Average Marginal Effects of Different Factors on U.S. Individuals’ Trade Policy Views

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The Average Marginal Effects of Different Factors on U.S. Individuals’ Trade Policy Views

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Summary of Findings

• Education is the only consistently significant factor associated with 

the U.S. individuals’ views on trade policy; 

• Industry of employment variables are not consistently significant 

across specifications;

• A higher expenditure-weighted import penetration ratio is associated 

with a lower likelihood of support for additional import restrictions;

• A higher expenditure-weighted applied tariff rate is also associated 

with a lower likelihood of support for additional import restrictions

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Resources and Tips for using the PUMD 

Dataset

• CE Survey PUMD Getting Started Guide

• Stata sample do-files

• “Dictionary”: “ce-pumd-interview-diary-dictionary.xlsx”

• Comparing your results with the publication tables for reference

• Reaching out to the CE staff! ☺

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Appendix: Summary Statistics on Selected Variables

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Appendix: Hypothesized Signs for Selected Variables

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Appendix:

Marginal effect

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Appendix:

Marginal effect
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Thank you!