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Peter Schott, Yale University, SOM

Monday, November 13, 2017 -
11:00am to 12:20pm
Rafik B. Hariri Building: Room 370, McDonough School of Business

Presenter: Peter Schott

Paper: Trade Liberalization and Investment: Evidence from the U.S. Granting of PNTR to China 

Abstract: This paper examines the effect of a change in U.S. trade policy on the investment behavior of manufacturing establishments. 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. However, an examination of heterogeneous responses within industries reveals that this effect is concentrated among establishments with low initial levels of capital intensity, skill intensity and labor productivity. Consistent with a reduction in uncertainty, we also find evidence that establishments’ investment activity becomes less lumpy following the policy change. 


The International Economics Seminar series is presented jointly with the Walsh School of Foreign Service and the Economics Department of Georgetown University.