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Does state‐owned enterprise (SOE) prevalence affect the employment adjustments of firms after trade liberalisation? This paper estimates the role of the prevalence of SOEs in the labour market in import competition by using city‐industry level panel data in China from 2000 to 2006. Our results indicate that import competition decreases employment in the manufacturing industry and that SOE prevalence could partially offset the negative effect on employment. This offsetting effect is demonstrated at both extensive and intensive margins. Moreover, SOE prevalence has a positive externality for the employment of non‐SOEs under the import competition shock. Therefore, we verify the positive externality of SOEs in labour market adjustment in response to import competition. [ABSTRACT FROM AUTHOR]

In this article, we make use of Vietnam's annual enterprise surveys to investigate the product selection and product mix responses to import competition in manufacturing firms. We estimate the effect of imports from Vietnam's free trade agreement partners on firms' product scope and sales concentration, controlling for firms and industry characteristics and the conditions in export markets. The empirical results consistently indicate that Vietnam's manufacturing firms narrow the product scope and concentrate on better selling products in response to rising import competition. Given the dominant presence of quality sorting in the manufacturing industries, our analysis suggests an aggregate quality improvement as firms reallocate sales towards high-quality products in responses to competition. [ABSTRACT FROM AUTHOR]

In recent years, manufacturing firmsin the United States have faced increasing import competition from low-wage countries, especiallyChina. Doesthis competition hurt or help firm innovation? This paper studies the effect of the surge in imports from China on innovation by US manufacturing firms. We first propose a theoretical framework that generates an inverted-U-shaped curve of innovation on imitation, which is based on the endogenous price elasticity of demand for the product in a Cournot model. We then take the theoretical prediction to data on publicly listed firms in the Compustat data set from 1990 to 2010. We find consistent evidence that Chinese import competition had an inverted-U effect on firm innovation, as measured by patent counts and citation-weighted patents. Our result suggests that when import penetration is less than 60% it positively affects firm innovation, but when it is more than 60%, this positive effect is inverted. This inverted-U relation persists when we instrument import competition in the United States by using Chinese import penetration in the United Kingdom and when we test the robustness of the results by including sector-specific trends. We find that the inverted-U relationship is steeper for firms in high-tech industries. [ABSTRACT FROM AUTHOR]

We study how different types of import competition affect firm productivity using firm‐product data from German manufacturing (2000–2014). Competition from high‐income countries causes affected domestic firms to increase their productivity and lower their prices. Oppositely, import competition from low‐wage countries does not lead to firm productivity gains. Instead, domestic firms' sales and input usage decline. Our findings confirm the intuition of ladder models that the effect of competition depends on the "closeness" of competitors. They are in line with widespread X‐inefficiencies throughout the economy, which firms reduce in response to competition from high‐income countries. [ABSTRACT FROM AUTHOR]

How do imports from China affect local labour markets in Japan? We examine this question using commuting zones as regional units and analysing shock propagation through supply chains and co‐location patterns. Applying the method proposed by Autor et al. (American Economic Review, 103, 2121, 2013) and Acemoglu, Autor et al. (Journal of Labor Economics, 34, S141, 2016), we examine the impact of import shocks on regional manufacturing employment using input–output tables which allows us to investigate the propagation of shocks to both upstream and downstream industries and to relate the regional impact to industry co‐location patterns. We find that the negative direct effect on local employment is underestimated in previous studies that do not consider the regional propagation of the shock through supply chains, especially the positive shock to downstream industries. Downstream industries in Japan, for example, significantly benefit from imports from China as they lower input prices and increase employment. In contrast to downstream industries, we find no significant impact on upstream industries. Our results imply that the direct negative effect on local labour markets is somewhat mitigated by effects on downstream industries within the same region. [ABSTRACT FROM AUTHOR]

This study empirically investigates the effect of import competition on within‐firm employment reorganisation using a Japanese firm‐level dataset covering the period of 1997–2014. Moreover, this study examines whether the import competition against low‐income countries leads to a shift from a manufacturing activity to non‐manufacturing activity, such as headquarters' services, wholesale, retail or R&D. Furthermore, this study explored the heterogeneity of the impacts of import competition according to firm size. Findings reveal that competition from Chinese imports induces manufacturing firms to increase the share of service workers, particularly workers that engage in wholesale, retail and other service activities. [ABSTRACT FROM AUTHOR]

This paper studies the effect of export expansion on the US labour market over the last two decades. Exploiting foreign emerging markets' unilateral liberalisation, this paper provides new empirical evidence for the importance of export expansion to the US labour market at the industry level. Using a novel instrumental variable strategy, the result confirms that US exports played a critical role in supporting manufacturing employment. Reduced‐form estimates imply that US exports to different markets created more than 1.6 million manufacturing jobs between 1991 and 2007, which is comparable to the estimated job losses attributed to the import competition from China. Meanwhile, there is substantial heterogeneity in this positive employment effect across export destinations and industries. Industries not only respond differently to various export shocks, but could also experience differential employment growth facing the same export shock. I find that the job creation effect is larger for industries with a higher initial share of workers who are older, less‐educated or non‐white, and performing routine‐based tasks. In addition, the effect is more pronounced for industries that had higher labour market concentration. [ABSTRACT FROM AUTHOR]

A rise in import competition can put downward pressure on local prices increasing consumer's welfare, but these gains might be unequal across households depending on the basket of goods consumed. Using a consumer price index that varies at the product and city level from Mexico, this paper analyses the impact of import competition from low‐wage countries, and particularly China, on price growth between 2002 and 2017. I find that the trade shock impacted prices. Had import competition remained unchanged, the 15‐year change in the consumer price index would have been seven percentage points higher, on average across all goods, with a much larger impact on the products highly exposed to the import competition. Second, using microdata from a household expenditure survey I find that all the households benefited from this access to cheaper goods, but the low‐income households benefited more. Finally, I show that the China shock only had a small effect on the evolution of the per capita expenditure inequality observed during this period. [ABSTRACT FROM AUTHOR]

This paper analyses the relationship between markups and international trade at the firm level using a large sample of French manufacturing firms for the period 1995–2007. In particular, the paper investigates the effect of increasing import competition from China on firms' price–cost margins and the way in which exporting interacts with this effect. The results show robust evidence that firms in more direct competition with Chinese imports decrease their markups. However, firms that become exporters experience a smaller reduction in their price–cost margins. Consistent with these findings, the results also show that firms facing tougher competition from China are more likely to start exporting to avoid such competitive pressures. [ABSTRACT FROM AUTHOR]

This paper examines innovation responses of a panel of Japanese firms to the intensified import competition from China in the period 1995–2005. We build a comprehensive firm‐level dataset linking patents and R&D merged to cross‐industry measures of Chinese import competition. Accounting for a simultaneity bias between innovation and importing and the possible heterogeneous effects across firms, we found that patenting has increased in response to an influx of Chinese imports, but it has adversely affected the quality of innovation, measured by forward citations received. These effects are only observed for globally engaged firms, not for firms focusing on the domestic market. [ABSTRACT FROM AUTHOR]