The China Syndrome: Local Labor Market Effects of Import Competition in the United States

By David H. Autor, David Dorn, Gordon H. Hanson. Social Science Research Network, 2013

1,476 citations recorded by the source corpus.

We 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.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/5be1938afb671edac044f3db83bcd6d875d5ef78

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Citations in the corpus

The Wage Effects of Offshoring: Evidence from Danish Matched Worker-Firm Data (2014, neutral): “computers, construction supplies), in a manner similar to Autor et al. (2012). The problem of correlated domestic and foreign demand shocks is potentially more of a concern for our exporting instruments, especially if these demand shocks are firm-year specific, wide-spread, and not adequately captur”
Trade, pollution and mortality in China (2016, neutral): “(2010), Topalova (2010), Autor et al. (2013), Kovak (2013), Acemoglu et al.”
An Alternative Theory of the Plant Size Distribution, with Geography and Intra- and International Trade (2014, neutral): “In a recent paper, Autor, Dorn, and Hanson ð2013Þ examine the effects of Chinese imports on labor market outcomes in the United States.”
Firm Age, Investment Opportunities, and Job Creation (2016, neutral): “A unit of observation in our analysis is, therefore, a commuting zone (CZ), developed by the Department of Agriculture for the purposes of delineating the local labor market and economy.10 Recent labor market research uses CZs widely as the unit of observation (e.g., Autor et al. (2013)).”
Employment Hysteresis from the Great Recession (2019, neutral): “(2002), Autor and Duggan (2003), and Autor et al. (2013) from specific contexts.”
Shift-Share Instruments and the Impact of Immigration (2018, neutral): “Autor, Dorn, and Hanson (2013) interact local industry shares with aggregate trade flows to examine the impact of Chinese imports on labor markets in the US.”
Commuting, Migration, and Local Employment Elasticities (2018, neutral): “Note that the elasticity of the price index (9) in location n with respect to wages in location i is (∂Pn/∂wi) (wi/Pn) = πni.”
From Good to Bad Concentration? US Industries over the Past 30 Years (2019, methodology): “They find evidence of product differentiation using the index of Hoberg and Phillips (2017). In the Appendix of Gutiérrez and Philippon 2017a, we study the dynamics of employment and find that leaders increase both capital and employment, while laggards decrease both.”
Industry Dynamics and Competition from Low-Wage Countries: Evidence on Italy (2014, neutral): “Finally, the effects of import penetration may be particularly significant in some regions, where there is a larger concentration of sectors exposed to foreign competition (Autor et al., 2011, Kandilov, 2009).”