Trilateral Trade and Taking a Side Between the U.S. and China

Abstract

Does China’s growing economic power generate political influence over its economic partners’ foreign policies? Does this tendency, if it exists, occur at the expense of U.S. interests on those issues? Since China and the U.S. maintain extremely opposing positions over diverse foreign policy issues, it is important to explore these questions. In the analysis of panel data on trilateral trade for China and the U.S. between 1991 and 2014, our empirical results show that China’s trade partners are likely to vote alongside it but against the U.S., even on human rights or important issues identified by the U.S. government in the UN General Assembly. In both cases, as the relative size of trade with China in comparison to the size of trade with the U.S. increases, a state tends to vote alongside China rather than the U.S. The findings imply that growing policy cooperation between China and its trade partners comes at the expense of U.S. national interests and its leadership to a great extent.