The effects of import competition on health in the local economy

Abstract

We provide evidence that average mental, physical, and general health worsens for employed workers in local U.S. labor markets exposed to greater import competition from China. The effects are greatest for mental health. Moving a region from the 25th to 75th percentiles of import exposure corresponds to a 7.8% increase in the morbidity of poor mental health, adding about 3 days of poor mental health per year for the average adult. Concurrently, the ability to afford health care decreases. Our results complement documented consequences of import competition on labor markets and temporary business cycle shocks on health outcomes.

Globalization and mental distress

“…The coefficient on IS is positive and highly significant in both cases, implying that import competition shocks raise the probability that individuals develop a clinically relevant mental disorder or suicidal ideation. The latter result complements the cross-county evidence for the US, according to which trade exposed localities exhibit relatively higher rates of deaths or hospital admissions due to suicides (Adda and Fawaz, 2017;Lang et al, 2019;Pierce and Schott, 2019). Yet, column (11) shows that there is significant action also below this threshold.…”

“…In panel b) we revisit, using our individual-level panel data, some of the evidence from contemporaneous studies based on regional data or repeated cross sections for the US (Adda and Fawaz, 2017;Lang et al, 2019;Pierce and Schott, 2019). To this purpose, we replace GHQ-12 with indirect proxies for mental distress.…”

“…A few independent studies, contemporaneous to our work, focus on import competition at the county level in the US and report that more trade exposed localities also experience a relative worsening in the average health conditions of their resident population. 2 Interestingly, among the various health indicators analyzed in these studies, trade exposed localities also exhibit higher mortality rates due to suicides and drug overdoses (Adda and Fawaz, 2017; Pierce and Schott, 2019); more hospital admissions due to alcohol abuse (Adda and Fawaz, 2017); and a higher average number of days of poor mental health in the population, as computed from answers to cross-sectional telephone surveys about self-assessed health (Adda and Fawaz, 2017;Lang et al, 2019).…”

Trade Liberalization and Mortality: Evidence from US Counties

“…Finally, in the international trade literature, our analysis adds to a growing body of research finding links between import competition and an array of socioeconomic outcomes, including self-reported health assessments (Lang, McManus, and Schaur 2019;McManus and Schaur 2016), provision of local public goods (Feler and Senses 2017), and innovation (Bloom, Draca, and Van Reenen 2016;Autor et al 2016). Here, our results contribute to a broader understanding of the distributional implications of trade liberalization by focusing on an outcome-mortality-that has only recently gained attention in the trade literature.…”

The Long‐run Relationship Between Trade and Population Health: Evidence from Five Decades

“…Autor et al (2013Autor et al ( , 2015 and Acemoglu et al (2016), using US industry-level data, find that Chinese import competition increases unemployment. Lang et al (2016) combine the approach of these papers for identifying import exposure at the local labour market level with health microdata for the United States and find that import competition from China tends to worsen health. However, to the extent that these results represent short-run effects and/or that the effects of trade go beyond those of import competition from a low-wage country like China, these results cannot be generalised to the long-run aggregate effects of total trade.…”