Trade,Foreign Direct Investment,and Immigration Policy Making 813 labor-scarce states,such as the United States,and a concomitant increase in wages. Without an increase in the labor supply,any advantage that firms gain from trade pro- tection may be erased because of increasing wages.One expects,then,that firms lobby for liberalizing LSIP when trade is restricted.As firms tend to be powerful, LSIP should be relatively open.Similarly,when firms are immobile across inter- national borders,because they are legally or technologically unable to move capital or because there are few safe places for investment,their need for low-skill labor at home increases as does their support for LSIP. In contrast,trade openness leads to a decrease in low-skill labor-intensive pro- duction,reducing the need for labor and,in many cases,forcing businesses to close.Businesses that close no longer lobby policy-makers,and businesses that remain open also have less incentive to lobby policy-makers for open LSIP as wages for low-skill workers have decreased.Similarly,when firms are mobile, because of open capital policies,new technologies,or greater investor protections from foreign governments,their support for LSIP decreases because of their outside option.Given the existence of groups who oppose LSIP,one expects that policy-makers will respond to less support for open LSIP by restricting it. In this article,I show how openness to trade and other states'openness to foreign capital affect LSIP through the lens of US senators'voting behavior on immigration after 1950.This case was chosen because,empirically,examining Senate voting allows one to establish causality.Although trade and capital policy are likely to be endogenous to firms'and policy-makers'preferences,I argue in this study that there are two measures-the level of tariff barriers and average world openness to capital flows-that US senators have had little ability to control since World War II.?With the Reciprocal Trade Agreements Act,Congress tied its own hands on tariff policy.Tariff rates could now stay the same or be cut;they could not be increased.Trade was also opened using international institutions such as the General Agreement on Tariffs and Trade/World Trade Organization (GATT/ WTO),which help perpetuate trade openness far removed from the influence of US senators.The ability to move production overseas during this time period was largely driven by the decision of other countries to open their markets to foreign direct investment (FDD);again,something that was beyond the influence of a single senator. Foreshadowing the results,voting on immigration in the post-1950 period can largely be explained by trade openness and the ability of firms to move overseas. There is little difference in voting behavior based on the explanations in the literature, including the party or ideology of the senators,welfare spending,unemployment, gross domestic product(GDP)growth,and the percent of foreign-born in the sena- tors'states. 7.Before 1950,the changes in LSIP and Senate voting behavior were driven by technological changes leading to the creation of a US national market,which had similar effects to the creation of the world market after World War II Peters 2011.labor-scarce states, such as the United States, and a concomitant increase in wages. Without an increase in the labor supply, any advantage that firms gain from trade pro￾tection may be erased because of increasing wages. One expects, then, that firms lobby for liberalizing LSIP when trade is restricted. As firms tend to be powerful, LSIP should be relatively open. Similarly, when firms are immobile across inter￾national borders, because they are legally or technologically unable to move capital or because there are few safe places for investment, their need for low-skill labor at home increases as does their support for LSIP. In contrast, trade openness leads to a decrease in low-skill labor-intensive pro￾duction, reducing the need for labor and, in many cases, forcing businesses to close. Businesses that close no longer lobby policy-makers, and businesses that remain open also have less incentive to lobby policy-makers for open LSIP as wages for low-skill workers have decreased. Similarly, when firms are mobile, because of open capital policies, new technologies, or greater investor protections from foreign governments, their support for LSIP decreases because of their outside option. Given the existence of groups who oppose LSIP, one expects that policy-makers will respond to less support for open LSIP by restricting it. In this article, I show how openness to trade and other states’ openness to foreign capital affect LSIP through the lens of US senators’ voting behavior on immigration after 1950. This case was chosen because, empirically, examining Senate voting allows one to establish causality. Although trade and capital policy are likely to be endogenous to firms’ and policy-makers’ preferences, I argue in this study that there are two measures—the level of tariff barriers and average world openness to capital flows—that US senators have had little ability to control since World War II.7 With the Reciprocal Trade Agreements Act, Congress tied its own hands on tariff policy. Tariff rates could now stay the same or be cut; they could not be increased. Trade was also opened using international institutions such as the General Agreement on Tariffs and Trade/World Trade Organization (GATT/ WTO), which help perpetuate trade openness far removed from the influence of US senators. The ability to move production overseas during this time period was largely driven by the decision of other countries to open their markets to foreign direct investment (FDI); again, something that was beyond the influence of a single senator. Foreshadowing the results, voting on immigration in the post-1950 period can largely be explained by trade openness and the ability of firms to move overseas. There is little difference in voting behavior based on the explanations in the literature, including the party or ideology of the senators, welfare spending, unemployment, gross domestic product (GDP) growth, and the percent of foreign-born in the sena￾tors’ states. 7. Before 1950, the changes in LSIP and Senate voting behavior were driven by technological changes leading to the creation of a US national market, which had similar effects to the creation of the world market after World War II. Peters 2011. Trade, Foreign Direct Investment, and Immigration Policy Making 813