Working Paper
To Find Relative Earnings Gains After the China Shock, Look Upstream and Outside Manufacturing
Abstract: We find that US workers outside manufacturing exhibit relative earnings increases after US trade liberalization with China. These relative gains cumulate over time as the beneficial effect of a workerâ s upstream exposureâ increased competition from China in input marketsâ more than offsets the detrimental impact of her own and downstream (customer) exposures. These relative gains are smaller for non-manufacturing workers with less ex ante firm tenure and lower initial earnings, and are absent among manufacturing workers due to a lack of upstream gains and stronger downstream losses.
JEL Classification: F13; F14; F15; F16;
https://doi.org/10.17016/IFDP.2026.1431
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Bibliographic Information
Provider: Board of Governors of the Federal Reserve System (U.S.)
Part of Series: International Finance Discussion Papers
Publication Date: 2026-01-13
Number: 1431