Trade, Development and Political Economy and Moynihan Institute of Global Affairs present: 

Yang Liang, PhD Candidate, Graduate Associate, Moynihan Institute of Global Affairs, Economics Department – Syracuse University 

Job Creation and Job Destruction: The Effect of Trade Shocks on US Employment

This paper studies the effect of trade expansion on the US labor market through both imports and exports over the last two decades. Despite job losses from import competition, I find evidence that numerous jobs are created in the US through export expansion. The effects of trade are identified by shocks to US imports and exports triggered by foreign countries' unilateral liberalization. Central estimates suggest that nearly 928 thousand manufacturing jobs were created through exports to the world between 1991 and 2007, whereas the number of job losses due to imports is estimated to be 845 thousand.  Combining these two sides, the substantial negative employment effect of import exposure to China is roughly balanced by the positive employment effect of export performance to the world at the industry level. Compared with previous findings, the estimated number of job losses due to import exposure to China decreases upon controlling for industry fixed effects. Meanwhile, export (import) shocks have positive (negative) impacts on other labor-market outcomes including the wage bill, establishment count, and share of production workers, without any effect on the average industry wage rate.

Yang Liang is a 5th year PhD candidate in the Economics Department and a graduate associate at Moynihan Institute of Global Affairs. His broad research interests are in international trade, labor economics, and applied microeconomics, more specifically, the causes and consequences of globalization. Liang’s current research agenda aims to understand the impact of trade expansion on domestic economic conditions such as employment, wages, and firms’ innovation decisions.

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Sponsored by Trade, Development and Political Economy at the Moynihan Institute of Global Affairs