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U.S. county-level impacts of growth in China’s demand for agricultural imports

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  • Cheng, Yichuan
  • Hillberry, Russell

Abstract

We use county-level data on agricultural outcomes and data on China’s imports of field crops to study the effect of growth in U.S. agricultural exports to China on U.S. county-level outcomes. A well-known instrumental variables strategy is used to isolate the Chinese import demand shock from other determinants of bilateral trade growth. Our first stage regressions indicate that China’s import demand growth explains most of the cross-county variation in growing exposure to China. Our second stage results offer mixed evidence that the import demand shock affected the agricultural outcomes we study. We attribute increases in total cropland acres to Chinese import demand growth, as well as decreases in two measures of government payments. While the estimated effects are large economically, the statistical evidence of China’s influence is generally weaker than other authors observe for manufacturing. It is likely that the consequences of the China shock on agriculture were subsumed by other shocks that occurred during this period.

Suggested Citation

  • Cheng, Yichuan & Hillberry, Russell, 2018. "U.S. county-level impacts of growth in China’s demand for agricultural imports," Conference papers 332977, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:332977
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    1. David H. Autor & David Dorn & Gordon H. Hanson & Jae Song, 2014. "Trade Adjustment: Worker-Level Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1799-1860.
    2. Leo Feler & Mine Z. Senses, 2017. "Trade Shocks and the Provision of Local Public Goods," American Economic Journal: Economic Policy, American Economic Association, vol. 9(4), pages 101-143, November.
    3. 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 2121-2168, October.
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