Cletus C. Coughlin

English

Research Papers in Economics

The Disconnect over
Free Trade
Most economists favor free trade.  The acrimony
that overwhelmed the recent attempt to launch a new
round of multilateral trade negotiations revealed vividly,
however, that national leaders and the general public have
major misgivings about embracing free trade.  What is the
extent of the disagreement in the United States among
economists, national leaders, and the general public? 
Surveys of economists have consistently shown a
consensus in favor of free trade.  A May 1992 article in
the American Economic Review (“Is There a Consensus
Among Economists in the 1990’s?” by Alston, Kearl,
and Vaughan), reported that more than 90 percent of
economists agreed that tariffs and import quotas usually
reduce general economic welfare.  This consensus in
1990 mirrored the results of a similar survey for 1976.
Obviously, the 1990 results are now a decade old, but no
compelling reason exists to expect that a similar survey
today would yield substantially different results.
As the chart illustrates, neither the general public nor
national leaders are as strongly in favor of reducing
trade barriers as economists.  Based on the answers to
two questions in a quadrennial survey by the Chicago
Council on Foreign Relations, it is clear that the general
public has major reservations about free trade.  In response
to a question in 1998 pointing out that the elimination
of tariffs and other import restrictions would lead to
lower prices, but that certain jobs in import-competitive
industries would likely be eliminated, only 32 percent of
the general public were in favor of eliminating tariffs.
Meanwhile, in response to a second question, 49 percent
were more sympathetic to the argument that tariffs are
necessary to protect jobs.  
Turning to national leaders—drawn from govern-
ment, businesses, academia, and policy institutes—in
senior positions with knowledge of international affairs,
one sees that these leaders generally are supportive of
eliminating tariffs.  For example, these leaders were
more sympathetic to the elimination of tariffs, 62 percent,
than they were to using tariffs to protect jobs, 34 percent.
Clearly, a substantial gap exists between these national
leaders and the general public.  In addition, it appears
that these national leaders are far less willing to support
a free trade position than economists are.
Over the past 20 years, it appears that the general
public has moved in the direction of supporting free
trade, while national leaders have moved in the other
direction.  In 1978, 22 percent of the general public
supported eliminating tariffs and other import restrictions,
while in 1998 the figure was 32 percent.  During the
same period, the proportion of national leaders in favor
of eliminating tariffs and other import restrictions
declined from 75 percent to 62 percent.
Clearly, the general public remains very reluctant to
support the free trade policies espoused by most econo-
mists.  One reason for their opposition stems from their
concerns about jobs, not necessarily their own.  On the
other hand, national leaders are less skeptical about free
trade than the general public, but their support for free
trade appears to be eroding somewhat.  These conflicting
opinions suggest how difficult it will be for the next
round of multilateral trade negotiations to reduce trade
barriers substantially.
—Cletus C. Coughlin
InternationalEconomicTrends
May 2000
Views expressed do not necessarily reflect official positions of the Federal Reserve System.
Eliminate tariffs?  Tariffs are necessary?
General Public
General Public
Percentage
National Leaders
National Leaders
100
80
60
40
20
0
1978 1982 1986 1990 1994 1998
Source:  Rielly, J.E., American Public Opinion and U.S. Foreign Policy 1999.

The disconnect over free trade

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The disconnect over free trade

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Research Papers in Economics