Competing with the Dragon: Employment and Wage Effects of Chinese Trade Competition in 17 Sectors Across 18 OECD Countries

INET Oxford Working Paper no. 2015-08

34 Pages Posted: 5 Feb 2016

See all articles by Stefan Thewissen

Stefan Thewissen

Leiden University - Department of Economics, Students

Olaf van Vliet

Leiden University - Leiden Law School; Leiden University - Department of Economics

Date Written: December 2015

Abstract

China’s rapid rise on the global economic stage has substantial and unequal employment and wage effects in advanced industrialised democracies given China’s large volume of low-wage labour. Thus far, these effects have not been analysed in the comparative political economy literature. Building on pooled time-series data, we analyse the effects of Chinese trade competition across 17 sectors in 18 countries. We devote attention to a new channel, increased competition from China in foreign export markets. Our empirical findings reveal overall employment declines in sectors more exposed to Chinese imports. Furthermore, effects on wages and employment are not equally shared across skill levels. For the high-skilled, Chinese competition yields neutral or positive effects whilst the low-skilled bear the brunt.

Keywords: globalisation, export competition, wage inequality, labour markets, sectors

JEL Classification: E24; F14; J30; O33

Suggested Citation

Thewissen, Stefan and van Vliet, Olaf, Competing with the Dragon: Employment and Wage Effects of Chinese Trade Competition in 17 Sectors Across 18 OECD Countries (December 2015). INET Oxford Working Paper no. 2015-08. Available at SSRN: https://ssrn.com/abstract=2727735 or http://dx.doi.org/10.2139/ssrn.2727735

Stefan Thewissen

Leiden University - Department of Economics, Students ( email )

Netherlands

Olaf Van Vliet (Contact Author)

Leiden University - Leiden Law School ( email )

Steenschuur 25 PO Box 9520
Leiden, 2300 RA
Netherlands

HOME PAGE: http://www.law.leiden.edu/organisation/taxlawandeconomics/economics/staff/vliet.html

Leiden University - Department of Economics ( email )

P.O. Box 9520
2300 RA Leiden, NL-2300RA
Netherlands

HOME PAGE: http://www.law.leiden.edu/organisation/taxlawandeconomics/economics/staff/vliet.html

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
37
Abstract Views
342
PlumX Metrics