China shock or China boost? Intermediate inputs and manufacturing resilience in Poland

Chencen Guo and Hong Ma
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Chencen Guo: Institute for International and Area Studies (IIAS), Tsinghua University
Hong Ma: Department of Economics, Tsinghua University

No 117, GRAPE Working Papers from GRAPE Group for Research in Applied Economics

Abstract: We analyze the effects of increased trade exposure to China on the Polish labor market during the period 2011–2019. Utilizing detailed industry-level data and an instrumental variable strategy based on trade flows from other Visegrad Group countries, we disentangle the impacts of import competition and access to imported intermediate inputs. We find that while import competition induced job losses in specific sectors, industries benefiting from access to Chinese intermediate inputs experienced substantial employment gains. Critically, this positive input channel effect was sufficient to offset the majority of displacement losses caused by import competition. Although manufacturing as a whole faced a slight net decline, the aggregate economy experienced net employment expansion. These results identify a “China Boost” driven by intermediate inputs, suggesting that Chinese imports act as strategic complements to domestic labor in Poland, contrasting sharply with the “China Shock” observed in the United States.

Keywords: China shock; global value chain; intermediate input; Poland (search for similar items in EconPapers)
JEL-codes: F14 F16 F66 P33 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2026
New Economics Papers: this item is included in nep-mac
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