¶ The China syndrome: Local labor market effects of import competition in the United States

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¶ BibTeX

@article{david2013china,
  title={The China syndrome: Local labor market effects of import competition in the United States},
  author={David, H and Dorn, David and Hanson, Gordon H},
  journal={American economic review},
  volume={103},
  number={6},
  pages={2121--68},
  year={2013}
}

¶ Abstract

We analyze the effect of rising Chinese import competition between 1990 and 2007 on US local labor markets, exploiting cross- market variation in import exposure stemming from initial differences in industry specialization and instrumenting for US 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 US manufacturing employment. Transfer benefits payments for unemployment, disability, retirement, and healthcare also rise sharply in more trade-exposed labor markets.

¶ My Notes

See here for notes on a related paper from the 2020 Trade Prelim.