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How Media Opinion Influences Imports in the US
Li Gang (李钢) 1* and Meng Lijun (孟丽君)2
1 Institute of Industrial Economics (IIE), Chinese Academy of Social Sciences (CASS), Beijing, China
2 School of Public Administration, Tsinghua University, Beijing
Abstract:Does public opinion influence US imports? Do countries with a good reputation export more to the US? And vice versa? Based on an extended trade gravity model, this paper employs news data from the GDELT database and US monthly import data to create an indicator of the influence of public opinion to examine the effects of US domestic public opinion on imports. Our research findings suggest that: (i) US public opinion influences US imports. Specifically, (ii) when public opinion turned negative during 2013-2017, it exerted a significantly negative effect on US imports; when public opinion was favorable during 2008-2012, it exerted an insignificantly positive effect on US imports. (iii) According to the pulse response function and variance decomposition, negative public opinion exerted a more significant and more lasting effect on US imports compared with positive public opinion. (iv) It can be discovered after further decomposing such effects on product categories that significant product heterogeneity exists in the public opinion effects on US imports: Complex and differentiated products are more influenced by negative public opinion while homogeneous and intermediate products are more influenced by positive public opinion.
Keywords:public opinion, trade barriers, US imports, product heterogeneity
JEL Classification Codes: E7, F14
DOI: 10.19602/j.chinaeconomist.2020.11.0
