International trade and the beliefs in hard work

ABSTRACT

This is the first empirical study to investigate the effects of trade-exposure experiences on people’s beliefs in hard work (BHW). Using a more flexible experience function than that used in previous studies, I find that both earlier and recent experiences have strong effects on BHW. BHW is strengthened by experiences of export exposure and weakened by those of import exposure in low- and middle-income countries. By contrast, import-exposure experiences positively affect BHW in high-income countries. In the US, however, import exposure, particularly from low-income countries, tends to weaken BHW, consistent with the ‘China trade shock’ literature.

KEYWORDS:

• Belief
• hard work
• macroeconomic experience
• trade

JEL CLASSIFICATION:

• D83
• F14
• F16
• Z13

Acknowledgments

I thank Isao Kamata, Hideo Owan, Hitoshi Sato, and Kiyoyasu Tanaka for their helpful comments. I also thank an anonymous referee and the editor, David Peel.

Disclosure statement

No potential conflict of interest was reported by the author.

Supplementary material

Supplemental data for this article can be accessed here.

Notes

¹ Individuals are excluded from the sample if the number of years with missing $E_{c,t-k}$ is more than 10% of the period from age 15 until year (t-1).

² {4.0, −1.0} is also the best weight recording the same SSR as {4.0, −2.0}, but the results are almost the same (Appendix Table A5).

Additional information

Funding

This work was supported by the Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO) under Grant [‘Labor in Global Value Chains’ project in FY2016-17] and the Japan Society for the Promotion of Science [KAKENHI Grant number JP19J00295].