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The Surprisingly Swift Decline of U.S. Manufacturing Employment

  • Justin R. Pierce
  • Peter K. Schott

This paper finds a link between the sharp drop in U.S. manufacturing employment beginning in 2001 and a change in U.S. trade policy that eliminated potential tariff increases on Chinese imports. Industries where the threat of tariff hikes declines the most experience more severe employment losses along with larger increases in the value of imports from China and the number of firms engaged in China-U.S. trade. These results are robust to other potential explanations of the employment loss, and we show that the U.S. employment trends differ from those in the EU, where there was no change in policy.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2014/wp-cesifo-2014-01/cesifo1_wp4563.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4563.

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Date of creation: 2014
Date of revision:
Handle: RePEc:ces:ceswps:_4563
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  1. Justin R. Pierce & Peter K. Schott, 2009. "A Concordance Between Ten-Digit U.S. Harmonized System Codes and SIC/NAICS Product Classes and Industries," NBER Working Papers 15548, National Bureau of Economic Research, Inc.
  2. Aghion, Philippe & Dewatripont, Mathias & Du, Liqun & Harrison, Ann & Legros, Patrick, 2011. "Industrial Policy and Competition," CEPR Discussion Papers 8619, C.E.P.R. Discussion Papers.
  3. Barry T. Hirsch & David A. Macpherson, 2003. "Union Membership and Coverage Database from the Current Population Survey: Note," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(2), pages 349-354, January.
  4. Khandelwal, Amit & Schott, Peter K. & Wei, Shang-Jin, 2012. "Trade liberalization and Embedded Institutional Reform: Evidence from Chinese Exporters," CEPR Discussion Papers 9246, C.E.P.R. Discussion Papers.
  5. Zhihong Yu & Yundan Gong & Sourafel Girma & Holger Görg, 2008. "Can production subsidies explain China's export performance? Evidence from firm level data," Kiel Working Papers 1442, Kiel Institute for the World Economy.
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