Economic Statecraft Trumps Ideology: Experimental Evidence on US Sanctions against Chinese Investment

Abstract

How does US economic statecraft shape public attitudes toward Chinese investment in third countries? As great power competition intensifies, middle powers face increasing pressure to align their economic relationships with geopolitical demands. How these pressures translate into policy depends critically on public opinion, yet we know little about how citizens in targeted countries respond to economic coercion. Using a pre-registered survey experiment conducted in Chile, we provide the first experimental evidence that US sanctions threats significantly reduce support for Chinese investment in a potential target country. Sanctions threats reduce positive evaluations by over 40 percentage points, a dramatic shift that persists across ideological groups, including left-leaning respondents typically skeptical of US influence. These findings suggest that, under conditions of credible economic threat, concrete costs can override abstract geopolitical loyalties, challenging theories that emphasize the primacy of ideological filters in foreign policy preferences. Our results speak to broader debates about economic statecraft effectiveness, demonstrating that threatened costs can reshape public preferences before any economic pain materializes, even among citizens predisposed against the sanctioning power.