818 Interational Organization low-skill-intensive firms and capital/high-skill and more productive firms will be referred to as low-skill-and high-skill-intensive,respectively.Low-skill-intensive firms benefit from open LSIP more than firms that are high-skill-intensive.29 Assuming that each firm's political capital is limited,low-skill-intensive firms should be willing to spend more political capital on LSIP than high-skill-intensive firms.It is not necessarily the case that high-skill-intensive firms do not want more low-skill immi- gration;it is simply that they prefer to spend their political capital elsewhere,including on high-skill immigration policy.As the proportion of high-skill-intensive firms increases,policy-makers will receive less political capital for the same level of LSIP and given the existence of groups that oppose immigration,one should expect that, all else equal,senators from states with higher high-skill intensity will support more restrictive LSIP.If one allows for oligopoly,increasing immigration conveys an advan- tage to firms that use more labor because it lowers these firms'costs to a greater extent, allowing them to capture a greater share of the market.High-skill-intensive firms may want to keep their competitive edge by giving contributions for restrictions. Trade closure,all else equal,should have an effect on the composition of firms in the United States;it should increase the number and/or size of low-skill-intensive firms,as,under the Ricardo-Viner model,domestic production becomes more com- petitive or,under the Melitz model,less-productive firms are able to stay in business.30 Thus,trade restrictions increase the demand for low-skill labor,increase the wages firms pay and,without an increase in the labor force,may erase gains from trade protection.31 Further,they increase the wage for low-skill labor in the nontrad- able or export sector as well.Therefore,one should expect that higher trade barriers should lead to increased support by firms and senators for open LSIP.Similarly,the inability to move production overseas (or low firm mobility)will also increase the pro- duction of low-skill labor-intensive goods,as firms have no choice but to produce at home,and increase support by firms and by senators for more open LSIP.32 Low-Skill Immigration Policy Under Open Trade and Low Firm Mobility Under autarky,firm preferences-and their willingness to spend political capital- are driven by their skill intensity.Opening trade does not affect these preferences; instead,it increases the proportion and/or size of firms that are high-skill-intensive. 29.Helpman,Itskhoki,and Redding 2009 argue that less productive firms will employ more low-skilled workers than more productive firms. 30.Melitz 2003. 31.Helpman,Itskhoki,and Redding 2009. 32.If trade is re-restricted and/or firm mobility is limited,there should be an increase in low-skill-inten- sive production,with a concomitant increase in demand for open LSIP.Yet trade and capital restrictions often are enacted during recessions.One might not expect firms to expand production during a recession and if they do expand,they can use native,previously unemployed labor until unemployment returned to its natural rate.At that point,one would expect wages to rise and firms to pressure the govemment for open LSIP.low-skill-intensive firms and capital/high-skill and more productive firms will be referred to as low-skill- and high-skill-intensive, respectively. Low-skill-intensive firms benefit from open LSIP more than firms that are high-skill-intensive.29 Assuming that each firm’s political capital is limited, low-skill-intensive firms should be willing to spend more political capital on LSIP than high-skill-intensive firms. It is not necessarily the case that high-skill-intensive firms do not want more low-skill immi￾gration; it is simply that they prefer to spend their political capital elsewhere, including on high-skill immigration policy. As the proportion of high-skill-intensive firms increases, policy-makers will receive less political capital for the same level of LSIP and given the existence of groups that oppose immigration, one should expect that, all else equal, senators from states with higher high-skill intensity will support more restrictive LSIP. If one allows for oligopoly, increasing immigration conveys an advan￾tage to firms that use more labor because it lowers these firms’ costs to a greater extent, allowing them to capture a greater share of the market. High-skill-intensive firms may want to keep their competitive edge by giving contributions for restrictions. Trade closure, all else equal, should have an effect on the composition of firms in the United States; it should increase the number and/or size of low-skill-intensive firms, as, under the Ricardo-Viner model, domestic production becomes more com￾petitive or, under the Melitz model, less-productive firms are able to stay in business.30 Thus, trade restrictions increase the demand for low-skill labor, increase the wages firms pay and, without an increase in the labor force, may erase gains from trade protection.31 Further, they increase the wage for low-skill labor in the nontrad￾able or export sector as well. Therefore, one should expect that higher trade barriers should lead to increased support by firms and senators for open LSIP. Similarly, the inability to move production overseas (or low firm mobility) will also increase the pro￾duction of low-skill labor-intensive goods, as firms have no choice but to produce at home, and increase support by firms and by senators for more open LSIP.32 Low-Skill Immigration Policy Under Open Trade and Low Firm Mobility Under autarky, firm preferences—and their willingness to spend political capital— are driven by their skill intensity. Opening trade does not affect these preferences; instead, it increases the proportion and/or size of firms that are high-skill-intensive. 29. Helpman, Itskhoki, and Redding 2009 argue that less productive firms will employ more low-skilled workers than more productive firms. 30. Melitz 2003. 31. Helpman, Itskhoki, and Redding 2009. 32. If trade is re-restricted and/or firm mobility is limited, there should be an increase in low-skill-inten￾sive production, with a concomitant increase in demand for open LSIP. Yet trade and capital restrictions often are enacted during recessions. One might not expect firms to expand production during a recession and if they do expand, they can use native, previously unemployed labor until unemployment returned to its natural rate. At that point, one would expect wages to rise and firms to pressure the government for open LSIP. 818 International Organization