Opposing firm-level responses to the China shock: Output competition versus input supply

P. Aghion, Antonin Bergeaud, Matthieu Lequien, M. Melitz and T. Zuber
Additional contact information
P. Aghion: College de France, LSE and INSEAD
M. Melitz: Harvard and NBER
T. Zuber: Banque de France

Documents de Travail de l'Insee - INSEE Working Papers from Institut National de la Statistique et des Etudes Economiques

Abstract: We decompose the China shock into two components that induce different adjustments for firms exposed to Chinese exports: an output shock affecting firms selling goods that compete with similar imported Chinese goods, and an input supply shock affecting firms using inputs similar to the imported Chinese goods. Combining French accounting, customs, and patent information at the firm-level, we show that the output shock is detrimental to firms sales, employment, and innovation. Moreover, this negative impact is concentrated on low-productivity firms. By contrast, we find a positive effect - although often not significant - of the input supply shock on firms sales, employment and innovation.

Keywords: Competition shock; patent; firms; import (search for similar items in EconPapers)
JEL-codes: F14 O19 O31 O33 O34 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-bec, nep-cna, nep-com, nep-int and nep-sbm
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https://www.bnsp.insee.fr/ark:/12148/bc6p07pz385/f1.pdf Document de travail de la DESE numero 2023/03 (application/pdf)

Related works:
Journal Article: Opposing Firm-Level Responses to the China Shock: Output Competition versus Input Supply (2024)
Working Paper: Opposing firm-level responses to the China shock: output competition versus input supply (2024)
Working Paper: Opposing Firm-Level Responses to the China Shock: Output Competition versus Input Supply (2024)
Working Paper: Opposing Firm-Level Responses to the China Shock: Output Competition versus Input Supply (2024)
Working Paper: Opposing Firm Level Responses to the China Shock: Output Competition versus Input Supply (2022)
Working Paper: Opposing firm-level responses to the China shock: output competition versus input supply (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:nse:doctra:2023-03

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