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Investment Responses to Trade Liberalization: Evidence from U.S. Industries and Plants / Justin R. Pierce, Peter K. Schott.

NBER Working papers Available online

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Format:
Book
Author/Creator:
Pierce, Justin R.
Contributor:
National Bureau of Economic Research.
Schott, Peter K.
Series:
Working Paper Series (National Bureau of Economic Research) no. w24071.
NBER working paper series no. w24071
Language:
English
Physical Description:
1 online resource: illustrations (black and white);
Other Title:
Investment Responses to Trade Liberalization
Place of Publication:
Cambridge, Mass. National Bureau of Economic Research 2017.
Summary:
This paper examines the effect of a change in U.S. trade policy on the domestic investment of U.S. manufacturers. Using a difference-in-differences identification strategy, we find that industries more exposed to reductions in import tariff uncertainty exhibit relative declines in investment after the change in trade policy. Within industries, we find that this relationship is concentrated among establishments with low initial levels of labor productivity, capital intensity and skill intensity. Plants with high initial levels of skill intensity, by contrast, exhibit relative increases in investment with exposure. We also find evidence that establishments' investment activity is smoother following the policy change.
Notes:
Print version record
November 2017.

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