The hidden cost of trade liberalization: Input tariff shocks and worker health in China

Haichao Fan, Faqin Lin and Shu Lin

Journal of International Economics, 2020, vol. 126, issue C

Abstract: This study examines the health effect of input tariff reductions on Chinese manufacturing workers and its heterogeneity across skill levels. We first provide a simple model to demonstrate the mechanisms. We then put the predictions of the model into a test using the China Health and Nutrition Survey data. Exploiting prefecture variations in input tariff shocks, we find that input tariff reductions following China's WTO accession adversely affect worker health through increased working hours. Moreover, input tariff reductions widen both the income and the health gaps between skilled and unskilled workers. Further welfare analysis indicates that ignoring health outcomes would substantially underestimate the welfare disparity between skilled and unskilled workers.

Keywords: Input tariff; Trade liberalization; Health; Welfare disparity; China (search for similar items in EconPapers)
JEL-codes: F1 I1 J2 J3 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:126:y:2020:i:c:s0022199620300659

DOI: 10.1016/j.jinteco.2020.103349

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