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Moving Hollywood Abroad: Divided Labor Markets and the New Politics of Trade in Services

Published online by Cambridge University Press:  02 October 2008

Kerry A. Chase
Kerry A. Chase
Affiliation:
Brandeis University, Waltham, Mass. E-mail: chase@brandeis.edu
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Abstract

Theories of trade and domestic politics have been applied extensively to manufacturing and agriculture; the political economy of trade in services, however, remains poorly understood. This article examines how the “offshoring” of services segments labor markets and places low-skilled and high-skilled labor at odds on trade issues. Drawing from a case where trade has been politically contentious of late—motion picture services in the United States—the article finds that offshoring can aggravate wage inequality, creating incentives for low-skilled workers to demand policy remedies. Consistent with this expectation, an ordered probit analysis of labor-group lobbying reveals that low-skilled occupations in motion picture services were most likely to support countervailing duties and Section 301 action against productions filmed abroad. The findings suggest that when services are tradable, labor-market cleavages are not purely factoral or sectoral, but occupational. This new politics of trade in services has important implications for trade policy in the United States and multilateral rulemaking in the World Trade Organization.

Type
Research Article
Information
International Organization , Volume 62 , Issue 4 , October 2008 , pp. 653 - 687
Copyright
Copyright © The IO Foundation 2008

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