Is trade the enemy of environment?: Congressional voting on environmental policies after the China shock

How does trade competition affect support for environmental protection? On the one hand, import shocks can dampen support for environmental protection, as international trade can lead to a race to the bottom or a regulatory chill. On the other hand, import competition can drive ‘dirty’ industries and firms out of business, reducing opposition to pro-environment legislation. The impact of import shocks on environmental protection is thus an empirical question. I leverage a sudden increase in Chinese imports in the United States after the two countries normalized their trade relations. I examine how import shocks experienced by each congressional district affect the pro-environmental score of the district’s representative in the U.S. House of Representatives from 1992 to 2014. My results show that bigger import shocks are positively associated with higher pro-environmental scores of the legislators. The findings suggest that as import shocks decrease the size of dirty industries, it paves the way for the legislators to pursue more pro-environmental policies.