China's Impact on Regional Employment: Propagation through Supply Chains and Co-agglomeration Pattern

Yukiko Saito, Shuhei Kainuma and Michal Fabinger

Discussion papers from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: How does import from China affect local labor markets in Japan? We examine this question using commuting zones as regional units, incorporating shock propagation through supply chains, as well as co-agglomeration patterns. Applying the method proposed by Autor, Dorn and Hanson (2013) and Acemoglu, et al. (2016), we investigate the impact on regional manufacturing employment. Employing the input-output table allows us to analyse how the shocks propagate to upstream/downstream industries and how regional impact is related to co-agglomeration patterns. We find that the negative direct effect on local employment is underestimated in previous studies that do not consider regional propagation of the shock through supply chains, especially the positive shock to downstream industries. Downstream industries significantly benefit from imports from China due to low input prices, which increases local employment. We find no significant impact on upstream industries. Our results imply that the direct effect on local labor markets is weakened by effects on downstream industries within the same region.

Pages: 36 pages
Date: 2020-05
New Economics Papers: this item is included in nep-cna, nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.rieti.go.jp/jp/publications/dp/20e054.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eti:dpaper:20054

Access Statistics for this paper

More papers in Discussion papers from Research Institute of Economy, Trade and Industry (RIETI) Contact information at EDIRC.
Bibliographic data for series maintained by TANIMOTO, Toko ().