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Individual preferences on trade liberalization: evidence from a Japanese household survey

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Abstract

This paper studies an individual’s preference on trade liberalization using a Japanese household survey, the Keio Household Panel Survey. As a result, we show that preferences toward trade liberalization are affected by economic factors (income, gender, family, asset, and job status) as well as noneconomic factors (noncognitive factors and behaviroal biases). We find that male, educated, and people with smaller family prefer trade liberalization. Furthermore, people who prefer liberty to equality and have less local patriotism, tend to be positive to trade liberalization.

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Notes

  1. The survey was conducted by a research company, Macromill, through the Internet. 560 economists and 1,035 common people answered the survey.

  2. See e.g., Felbermayr et al. (2019) on the impact of the EU–Japan EPA on the Japanese economy and Chowdhry et al. (2019) on political debate on the US-Japan FTA. See e.g. Baldwin and Okubo (2019) on the impact of global value chains on the Japanese economy.

  3. See Mulgan (2015) and Zakowski et al. (2018) for more policy discussions and political debates on the TPP.

  4. Jakel and Smolka (2013, 2017) using the 2003 National Identity mod-ule from the International Social Survey Program and the 2007 wave of the Pew Global Attitudes Project, found significant Heckscher-Ohlin theorem impacts in individuals’ preference toward trade policy. In a similar framework, O’Rourke and Sinnott (2006) investigated individual preference to immigration.

  5. Apart from the household survey, Kagitani and Harimaya (2019) studied the attitude of candidates in the election campaign toward TPP. The presence of agriculture in electoral districts of candidates relates to their negative attitude to the TPP before the ratification of TPP, although not after. Their stances on the TPP are also affected by their parties’ policies.

  6. Naoi and Kume (2011) interviewed 1200 people in Japan about food imports by showing different photographs. They found that respondents from the viewpoint of producers rather than consumers show increased opposition to food imports.

  7. Using the same data set, Ito et al. (2019) focused on regional differences. Regions with more agricultural farmers tend to be negative to trade liberalization.

  8. The KHPS survey is also called the Japan Household Panel Survey, JHPS/KHPS or KJHPS.

  9. In the first stage, Japan is stratified into 24 regions according to a city–region classification. The number of samples for each region is distributed in accordance with basic resident register population ratios. Then, the number of survey areas to be surveyed within each region is set up with around 10 households for each survey area, defined by districts corresponding to the Population Census, and a random sampling of the designated number of survey areas is implemented. Survey areas are employed by national census survey districts as sampling units. In the second sampling stage, basic resident registers for the selected survey areas are employed as sampling registers, and approximately 10 respondents for each survey area are drawn from the population.

  10. According to the Household Survey (Ministry of Internal Affairs), 37,000 yen is the average per-month tax payment in Japan.

  11. Occupations are agriculture, fishery, mining, construction, manufacturing, wholesale and retail, restaurant and hotel, banking and insurance, real estate, transportation, information, telecommunication, gas–electricity–water supply, medical services, education, other, public, misc.

  12. See Kondo and Okubo (2016) for the determinants of interregional migration in Japan.

  13. The core is defined as Greater Tokyo (Tokyo, Saitama, Chiba, and Kanagawa prefectures), Greater Osaka (Osaka, Kyoto, and Hyogo prefectures), and Aichi.

  14. Table 5 reports the marginal effect for each variable in the specification of Column 4.

  15. Table 7 reports the marginal effect for each variable in terms of Column 4 of Table 6.

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Acknowledgement

We would like to thank two anonymous referees and an editor for helpful comments. The data analysis in this paper utilizes Keio Household Panel Survey (KHPS) data (Japan Household Panel Survey, JHPS) provided by the Panel Data Research Center at Keio University, Tokyo, Japan. We thank Eiichi Tomiura and Tomohiro Kuroda for their helpful comments as well as participants in seminars at RIETI and Shimonoseki City University. This research is funded by Grant-in-Aid for Scientific Research (Japan Society for the Promortion of Science (JSPS)) (19H01487, 19H00594, 20H00071, 17H06086).

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Authors and Affiliations

  1. Kiel Institute for the World Economy, Kiellinie 66, 24105, Kiel, Germany

    Gabriel Felbermayr

  2. Faculty of Economics, Keio University, 2-15-45 Mita, Minato-ku, Tokyo, 108-8345, Japan

    Toshihiro Okubo

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  1. Gabriel Felbermayr
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Correspondence to Toshihiro Okubo.

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Appendix

Appendix

See Table 9 here.

Table 9 Variable definition
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Felbermayr, G., Okubo, T. Individual preferences on trade liberalization: evidence from a Japanese household survey. Rev World Econ 158, 305–330 (2022). https://doi.org/10.1007/s10290-021-00432-3

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