US antidumping investigations and employment adjustment in Chinese manufacturing firms

Abstract

AbstractThis paper examines the effects of antidumping (AD) investigations on the employment of firms in investigated countries. We utilized firm‐level data from China and data on the AD investigations launched against China by the United States. To measure the intensity of the AD investigations, an AD index was constructed at the industry level, which is the sum of the number of AD investigations in previous years weighted by the inverse of the year distance. We found that firms in the investigated sectors responded to AD investigations by decreasing their numbers of employees, in particular their permanent and skilled employees. Within the investigated sectors, domestic firms were found to be even more active than exporting firms in adjusting their employment practices. Moreover, exporting firms were also found to be likely to increase their investment in research and development (R&D) after AD investigations while domestic firms were found to be more likely to decrease their R&D expenditure.