The China Syndrome: Local Labor Market Effects of Import Competition in the United States
AbstractWe analyze the effect of rising Chinese import competition between 1990 and 2007 on U.S. local labor markets, exploiting cross-market variation in import exposure stemming from initial differences in industry specialization and instrumenting for U.S. imports using changes in Chinese imports by other high-income countries. Rising imports cause higher unemployment, lower labor force participation, and reduced wages in local labor markets that house import-competing manufacturing industries. In our main specification, import competition explains one-quarter of the contemporaneous aggregate decline in U.S. manufacturing employment. Transfer benefits payments for unemployment, disability, retirement, and healthcare also rise sharply in more trade-exposed labor markets.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7150.
Length: 67 pages
Date of creation: Jan 2013
Date of revision:
Publication status: published in: American Economic Review, 2013, 103 (6), 2121-68
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Other versions of this item:
- David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-68, October.
- David H. Autor & David Dorn & Gordon H. Hanson, 2012. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," NBER Working Papers 18054, National Bureau of Economic Research, Inc.
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-03 (All new papers)
- NEP-CNA-2013-02-03 (China)
- NEP-LTV-2013-02-03 (Unemployment, Inequality & Poverty)
- NEP-URE-2013-02-03 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Arnaud Costinot & Andres Rodriguez-Clare & Costas Arkolakis, 2010.
"New Trade Models, Same Old Gains?,"
2010 Meeting Papers
433, Society for Economic Dynamics.
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