CEO Ideology and Global Trade / Elisabeth Kempf, Mancy Luo, Margarita Tsoutsoura.

Format:

Book

Author/Creator:

Kempf, Elisabeth.

Contributor:

Luo, Mancy.

Tsoutsoura, Margarita.

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w33712.

NBER working paper series no. w33712

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2025.

Summary:

We study how the political ideology of corporate leaders shapes international trade. Exploiting changes in ideological alignment between U.S. firm CEOs and foreign governments around national elections, we show that firms reduce imports from countries whose governments become more ideologically distant from their CEOs, relative to firms whose CEOs become more aligned. Firms whose CEOs become more ideologically distant do not significantly reduce their total imports; instead, they reallocate toward origin countries that are ideologically closer and more expensive to source from. Textual analysis of earnings call transcripts suggests that an important mechanism behind these patterns is a change in CEOs' perceptions of foreign macroeconomic conditions.

Notes:

April 2025.

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