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Do Non-tariff Barriers to Trade Save American Jobs and Wages?

Author

Listed:
  • Leonardi, Marco

    (University of Milan)

  • Meschi, Elena

    (Università Ca’ Foscari di Venezia)

Abstract

Before the recent rebound due to the US–China trade war, tariffs on international trade were being progressively reduced over the last decades and advanced countries increasingly relied on non-tariff measures (NTMs) to protect their industries from foreign competition. In this paper, we exploit a novel database on NTMs to test their role in shaping the labour market effects of exposure to Chinese import competition over the 2000–2015 period. We relate changes in manufacturing employment to the share of employed workers protected by NTMs across US local labour markets and we instrument NTMs using the industry share of employment in swing states during presidential elections. Our results indicate that NTMs mitigate the negative employment effect of exposure to Chinese imports and have a positive effect on manufacturing wages (especially for the unskilled).

Suggested Citation

  • Leonardi, Marco & Meschi, Elena, 2021. "Do Non-tariff Barriers to Trade Save American Jobs and Wages?," IZA Discussion Papers 14162, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14162
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    References listed on IDEAS

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    Cited by:

    1. Giorgio Barba Navaretti & Giulia Felice & Emanuele Forlani & Paolo Garella, 2018. "Non-tariff measures and competitiveness," Development Working Papers 438, Centro Studi Luca d'Agliano, University of Milano, revised 01 Feb 2023.
    2. Dorn, David & Levell, Peter, 2021. "Trade and Inequality in Europe and the US," CEPR Discussion Papers 16780, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    import competition; non-tariff barriers; labour market; Chinese imports;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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