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Plant exit and U.S. imports from low-wage countries

Plant exit and U.S. imports from low-wage countries
Plant exit and U.S. imports from low-wage countries
Over the past twenty years, imports to the U.S. from low-wage countries have increased dramatically. In this paper we examine how low-wage country import competition in the U.S. influences the probability of manufacturing establishment closure. Confidential data from the U.S. Bureau of the Census are used to track all manufacturing establishments between 1992 and 2007. These data are linked to measures of import competition built from individual trade transactions. Controlling for a variety of plant and firm covariates, we show that low-wage import competition has played a significant role in manufacturing plant exit. Analysis employs fixed effects panel models running across three periods: the first plant-level panels examining trade and exit for the U.S. economy. Our results appear robust to concerns regarding endogeneity.
2110-7017
27-40
Rigby, David
6b590eec-ab59-4fe6-8f6c-606bc40732a6
Kemeny, Thomas
b9e4ac0c-bc73-4905-8229-f970518cde88
Cooke, Abigail
d6d78cd6-14ba-43b9-8ee9-0c5e1492ac33
Rigby, David
6b590eec-ab59-4fe6-8f6c-606bc40732a6
Kemeny, Thomas
b9e4ac0c-bc73-4905-8229-f970518cde88
Cooke, Abigail
d6d78cd6-14ba-43b9-8ee9-0c5e1492ac33

Rigby, David, Kemeny, Thomas and Cooke, Abigail (2017) Plant exit and U.S. imports from low-wage countries. International Economics, 149, 27-40. (doi:10.1016/j.inteco.2016.09.001).

Record type: Article

Abstract

Over the past twenty years, imports to the U.S. from low-wage countries have increased dramatically. In this paper we examine how low-wage country import competition in the U.S. influences the probability of manufacturing establishment closure. Confidential data from the U.S. Bureau of the Census are used to track all manufacturing establishments between 1992 and 2007. These data are linked to measures of import competition built from individual trade transactions. Controlling for a variety of plant and firm covariates, we show that low-wage import competition has played a significant role in manufacturing plant exit. Analysis employs fixed effects panel models running across three periods: the first plant-level panels examining trade and exit for the U.S. economy. Our results appear robust to concerns regarding endogeneity.

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PlantExit_AcceptedVersion_preprint.pdf - Accepted Manuscript
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Accepted/In Press date: 14 September 2016
e-pub ahead of print date: 15 September 2016
Published date: May 2017
Organisations: University of Southampton

Identifiers

Local EPrints ID: 401681
URI: http://eprints.soton.ac.uk/id/eprint/401681
ISSN: 2110-7017
PURE UUID: 5246277b-b40b-4fe7-bd9b-fc43412148ce

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Date deposited: 21 Oct 2016 11:17
Last modified: 06 Oct 2020 22:09

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Contributors

Author: David Rigby
Author: Thomas Kemeny
Author: Abigail Cooke

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