Webinar: Trade Protection along Supply Chains

To participate, please send an email to: ae-secr@ese.eur.nl

During the last few decades, the United States has applied increasingly high antidumping (AD) duties on imports from China. We combine detailed information on these duties and other tariffs applied since the 1980s with US input-output data to study the effects of trade protection along supply chains.To deal with endogeneity concerns, we instrument tariffs exploiting variation in the political importance of industries – resulting from changes in the identity of swing states across electoral terms – and in their historical experience at petitioning for AD. We find that tariffs in upstream industries have large negative effects on downstream industries, raising input prices and decreasing employment, sales, and investment. Our baseline estimates indicate that during 1988-2016, around 570,000 US jobs were lost in downstream industries due to AD duties against China in upstream industries, with the largest losses suffered by non manufacturing sectors that rely heavily on protected inputs. Since President Trump took office, around 200,000 additional jobs were lost in downstream industries due to AD protection against China.

(with Chad Bown, Paola Conconi, Lorenzo Trimarchi)