A study published earlier this year suggests that imports in US-
China trade have had a significant negative impact not just on
factory workers but also on their communities.
As top economic officials from the US and China meet in
Washington this week, old concerns still linger: Are China's trade
policies stealing jobs from American workers? Should the US take a
tougher, more retaliatory line in its own trade policies?
It's a debate that raged even in under President Clinton in the
1990s, when Chinese exports to the US were much smaller and the US
economy was much healthier.
In two-day bilateral talks this week, Treasury Secretary Tim
Geithner pressed China to do more to protect intellectual property
rights for global companies like Microsoft, and to allow its
currency to move in foreign-exchange markets with greater
flexibility. Some lawmakers in the US Congress have proposed a
stronger-armed approach, slapping on trade penalties if Beijing
fails to act along those lines.
The dialogue - and the threats of pressure from Congress - come
as recent research by economists may be bringing the ripple effects
of US-China trade into clearer focus. The upshot of the research
isn't that trade with China is harming the US economy, but it does
suggest that the negative effects on many US workers have been
In a study published earlier this year, three academic economists
examined the effects of rising imports from China on the US job
market since 1990. They sought what could be called the "China
effect" by looking at local labor markets, including some that were
heavily affected by Chinese imports and some that were less
What they found were sizable negative effects in the form of lost
jobs, lower wages, and lower labor-force participation. Although the
job losses were concentrated in factories - accounting for one-
third of the decline in US manufacturing jobs between 1990 and 2007 -
the effects on wages spread throughout local economies, concluded
researchers David Autor of the Massachusetts Institute of
Technology, David Dorn of the Center for Monetary and Financial
Studies in Madrid, and Gordon Hanson of the University of California
in San Diego.
"There is nothing in our results to show that US trade with China
overall is negative" in its impacts, Mr. Hanson says. For one thing,
their study makes no effort to account for positive impacts on the
economy from US exports to China. …