{
  "title": "Trading with China: Productivity Gains, Job Losses",
  "publication": "IMF Working Papers, May 23, 2017",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2017/05/23/trading-with-china-productivity-gains-job-losses-44860",
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  "summary": "We analyze the impact on productivity in advanced economies of fast-growing trade with China between the mid-1990s and late-2000s, separately identifying the export and import channels.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Study period: mid-1990s to late-2000s.\n- Sample: country-sector-level data for 18 advanced economies.\n- Main finding: large productivity gains from trading with China accompanied by adverse employment effects in exposed industries.\n- Interpretation: results point to large gains from free trade and underscore the scope for a more active policy role in redistributing gains and easing workers’ transitions between jobs and industries."
    },
    {
      "heading": "Methodology",
      "content": "- Identification strategy: instrument imports from (exports to) China in a given country-sector with the average imports from (exports to) China in the same sector in other advanced economies (approach similar to Autor, Dorn, and Hanson (2013)).\n- Empirical focus: separately identify export and import channels; exploit exogenous variation in trade with China across country-sectors."
    },
    {
      "heading": "Quantitative Results and Key Statistics",
      "content": "- Median country-sector productivity effect: the (exogenous) rise of China in global trade may have increased the level of total factor productivity by about 1.9 percent.\n- Contribution to overall TFP increase: the 1.9 percent increase equals 12.3 percent of the overall increase over the sample period.\n- Sample size: 18 advanced economies.\n- Paper length: 13 pages.\n- Publication identifiers: Working Paper No. 2017/122; Issue: 122; Volume: 2017; DOI: https://doi.org/10.5089/9781475595833.001; ISBN: 9781475595833; ISSN: 1018-5941; Stock No: WPIEA2017122."
    },
    {
      "heading": "Employment Effects",
      "content": "- Using a similar empirical strategy, the authors find adverse employment effects of Chinese imports in exposed country-industries, consistent with previous studies.\n- Net result: productivity gains coexisting with job losses in certain industries."
    },
    {
      "heading": "Policy Implications and Recommendations",
      "content": "- Recognize large aggregate gains from free trade driven by trade with China.\n- Address distributional consequences through more active policy interventions, including:\n  - Easing workers’ transition between jobs and industries (retraining, mobility support).\n  - Redistributive measures to share gains across affected workers and communities.\n\nSource: Trading with China: Productivity Gains, Job Losses, IMF Working Papers 2017, 122 (2017).\n\n---\n\n Content in this bundle\n\n- Trading with China: Productivity Gains, Job Losses, WP/17/122, May 2017\n  - Trading with China: Productivity Gains, Job Losses, WP/17/122, May 2017 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Trading with China: Productivity Gains, Job Losses, WP/17/122, May 2017 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2017/05/23/trading-with-china-productivity-gains-job-losses-44860"
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    "Authors: JaeBin Ahn, Romain A Duval",
    "Published: May 23, 2017",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475595833.001",
    "Study period: mid-1990s to late-2000s.",
    "Sample: country-sector-level data for 18 advanced economies.",
    "Main finding: large productivity gains from trading with China accompanied by adverse employment effects in exposed industries.",
    "Interpretation: results point to large gains from free trade and underscore the scope for a more active policy role in redistributing gains and easing workers’ transitions between jobs and industries.",
    "Identification strategy: instrument imports from (exports to) China in a given country-sector with the average imports from (exports to) China in the same sector in other advanced economies (approach similar to Autor, Dorn, and Hanson (2013)).",
    "Empirical focus: separately identify export and import channels; exploit exogenous variation in trade with China across country-sectors.",
    "Median country-sector productivity effect: the (exogenous) rise of China in global trade may have increased the level of total factor productivity by about 1.9 percent.",
    "Contribution to overall TFP increase: the 1.9 percent increase equals 12.3 percent of the overall increase over the sample period.",
    "Sample size: 18 advanced economies.",
    "Paper length: 13 pages.",
    "Publication identifiers: Working Paper No. 2017/122; Issue: 122; Volume: 2017; DOI: https://doi.org/10.5089/9781475595833.001; ISBN: 9781475595833; ISSN: 1018-5941; Stock No: WPIEA2017122.",
    "Using a similar empirical strategy, the authors find adverse employment effects of Chinese imports in exposed country-industries, consistent with previous studies.",
    "Net result: productivity gains coexisting with job losses in certain industries.",
    "Recognize large aggregate gains from free trade driven by trade with China.",
    "Address distributional consequences through more active policy interventions, including:",
    "**Trading with China: Productivity Gains, Job Losses, WP/17/122, May 2017**"
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