Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/10874.html
   My bibliography  Save this paper

The Hidden Cost of Globalization: Import Competition and Mental Distress

Author

Listed:
  • Colantone, Italo
  • Crinò, Rosario
  • Ogliari, Laura
Abstract
We study the effect of import competition on workers? mental distress. To this purpose, we source information on the mental health of British workers from the British Household Panel Survey, and combine it with measures of import competition in more than 100 industries over 2001-2007. We find an increase in import competition to have a positive, statistically significant, and large impact on mental distress. The effect is strikingly robust to controlling for a wide range of individual, household, and industry characteristics. We show that part of the effect is due to import competition worsening the current labor market situation of individuals, in terms of higher probability of job displacement and lower wage growth. Additionally, and most importantly, we show that import competition worsens mental health also for individuals witnessing no change in observable labor market conditions, by increasing stress on the job and worsening expectations about the future.

Suggested Citation

  • Colantone, Italo & Crinò, Rosario & Ogliari, Laura, 2015. "The Hidden Cost of Globalization: Import Competition and Mental Distress," CEPR Discussion Papers 10874, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:10874
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP10874
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Andrew E. Clark, 2003. "Unemployment as a Social Norm: Psychological Evidence from Panel Data," Journal of Labor Economics, University of Chicago Press, vol. 21(2), pages 289-322, April.
    2. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-2168, October.
    3. Marcus, Jan, 2013. "The Effect of Unemployment on the Mental Health of Spouses – Evidence from plant closures in Germany," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 32(3), pages 546-558.
    4. Hannes Schwandt, 2018. "Wealth Shocks and Health Outcomes: Evidence from Stock Market Fluctuations," American Economic Journal: Applied Economics, American Economic Association, vol. 10(4), pages 349-377, October.
    5. David H. Autor & David Dorn & Gordon H. Hanson & Jae Song, 2014. "Trade Adjustment: Worker-Level Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1799-1860.
    6. Emily Oster, 2012. "Routes Of Infection: Exports And Hiv Incidence In Sub-Saharan Africa," Journal of the European Economic Association, European Economic Association, vol. 10(5), pages 1025-1058, October.
    7. Lídia Farré & Francesco Fasani & Hannes Mueller, 2018. "Feeling useless: the effect of unemployment on mental health in the Great Recession," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-34, December.
    8. Wolfgang Dauth & Sebastian Findeisen & Jens Suedekum, 2014. "The Rise Of The East And The Far East: German Labor Markets And Trade Integration," Journal of the European Economic Association, European Economic Association, vol. 12(6), pages 1643-1675, December.
    9. Bernard, Andrew B. & Jensen, J. Bradford & Schott, Peter K., 2006. "Survival of the best fit: Exposure to low-wage countries and the (uneven) growth of U.S. manufacturing plants," Journal of International Economics, Elsevier, vol. 68(1), pages 219-237, January.
    10. Andrew Hughes Hallett & Christian Richter, 2006. "Is the convergence of business cycles a global or regional issue? The UK, US and Euroland," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 11(3), pages 177-194.
    11. Colantone, Italo & Crinò, Rosario, 2014. "New imported inputs, new domestic products," Journal of International Economics, Elsevier, vol. 92(1), pages 147-165.
    12. Christopher J. Ruhm, 2000. "Are Recessions Good for Your Health?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(2), pages 617-650.
    13. Rafael Di Tella & Sebastian Galiant & Ernesto Schargrodsky, 2007. "The Formation of Beliefs: Evidence from the Allocation of Land Titles to Squatters," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(1), pages 209-241.
    14. Jeffrey R Kling & Jeffrey B Liebman & Lawrence F Katz, 2007. "Experimental Analysis of Neighborhood Effects," Econometrica, Econometric Society, vol. 75(1), pages 83-119, January.
    15. Pinelopi Koujianou Goldberg & Amit Kumar Khandelwal & Nina Pavcnik & Petia Topalova, 2010. "Imported Intermediate Inputs and Domestic Product Growth: Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(4), pages 1727-1767.
    16. James Heckman & Rodrigo Pinto & Peter Savelyev, 2013. "Understanding the Mechanisms through Which an Influential Early Childhood Program Boosted Adult Outcomes," American Economic Review, American Economic Association, vol. 103(6), pages 2052-2086, October.
    17. Amit Khandelwal, 2010. "The Long and Short (of) Quality Ladders," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 77(4), pages 1450-1476.
    18. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2001. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 607-654.
    19. Lídia Farré & Francesco Fasani & Hannes Mueller, 2018. "Feeling useless: the effect of unemployment on mental health in the Great Recession," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-34, December.
    20. Daron Acemoglu & David Autor & David Dorn & Gordon H. Hanson & Brendan Price, 2016. "Import Competition and the Great US Employment Sag of the 2000s," Journal of Labor Economics, University of Chicago Press, vol. 34(S1), pages 141-198.
    21. James P. Smith, 1999. "Healthy Bodies and Thick Wallets: The Dual Relation between Health and Economic Status," Journal of Economic Perspectives, American Economic Association, vol. 13(2), pages 145-166, Spring.
    22. Marie Connolly, 2013. "Some Like It Mild and Not Too Wet: The Influence of Weather on Subjective Well-Being," Journal of Happiness Studies, Springer, vol. 14(2), pages 457-473, April.
    23. McInerney, Melissa & Mellor, Jennifer M. & Nicholas, Lauren Hersch, 2013. "Recession depression: Mental health effects of the 2008 stock market crash," Journal of Health Economics, Elsevier, vol. 32(6), pages 1090-1104.
    24. Lucrezia Reichlin, 2005. "The Euro area business cycle: stylized facts and measurement issues," ULB Institutional Repository 2013/10173, ULB -- Universite Libre de Bruxelles.
    25. Ann L. Owen & Stephen Wu, 2007. "Is Trade Good for Your Health?," Review of International Economics, Wiley Blackwell, vol. 15(4), pages 660-682, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Barbara Dluhosch & Daniel Horgos, 2019. "International Competition Intensified: Job Satisfaction Sacrificed?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 143(2), pages 479-504, June.
    2. Cevat G. Aksoy & Sergei Guriev & Daniel S. Treisman, 2018. "Globalization, Government Popularity, and the Great Skill Divide," NBER Working Papers 25062, National Bureau of Economic Research, Inc.
    3. Grossmann, Volker & Strulik, Holger, 2021. "Illicit drugs and the decline of the middle class," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 718-743.
    4. Italo Colantone & Piero Stanig, 2017. "The Trade Origins of Economic Nationalism: Import Competition and Voting Behavior in Western Europe," BAFFI CAREFIN Working Papers 1749, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    5. Italo Colantone & Alessia Matano & Paolo Naticchioni, 2020. "New imported inputs, wages and worker mobility," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(2), pages 423-457.
    6. Gu, Grace Weishi & Malik, Samreen & Pozzoli, Dario & Rocha, Vera, 2016. "Trade Induced Skill Upgrading: Lessons from the Danish and Portuguese Experiences," IZA Discussion Papers 10035, Institute of Labor Economics (IZA).
    7. Colantone, Italo & Crinò, Rosario & Ogliari, Laura, 2019. "Globalization and mental distress," Journal of International Economics, Elsevier, vol. 119(C), pages 181-207.
    8. Luca Salvatici & Silvia Nenci, 2017. "New features, forgotten costs and counterfactual gains of the international trading system," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 44(4), pages 592-633.
    9. Hummels, David & Munch, Jakob R. & Xiang, Chong, 2016. "No Pain, No Gain: The Effects of Exports on Effort, Injury, and Illness," IZA Discussion Papers 10036, Institute of Labor Economics (IZA).
    10. Jonathan de Quidt & Johannes Haushofer, 2017. "Depression through the Lens of Economics: A Research Agenda," NBER Chapters, in: The Economics of Poverty Traps, pages 127-152, National Bureau of Economic Research, Inc.
    11. Jonathan D. Ostry & Andrew Berg & Siddharth Kothari, 2021. "Growth‐equity trade‐offs in structural reforms," Scottish Journal of Political Economy, Scottish Economic Society, vol. 68(2), pages 209-237, May.
    12. Clément Malgouyres, 2017. "Trade Shocks and Far-Right Voting: Evidence from French Presidential Elections," RSCAS Working Papers 2017/21, European University Institute.
    13. Faqin Lin & Xiaosong Wang & Mohan Zhou, 2022. "How trade affects pandemics? Evidence from severe acute respiratory syndromes in 2003," The World Economy, Wiley Blackwell, vol. 45(7), pages 2270-2283, July.
    14. Jonathan de Quidt & Johannes Haushofer, 2016. "Depression for Economists," NBER Working Papers 22973, National Bureau of Economic Research, Inc.
    15. Matthieu Crozet & Laura Hering & Sandra Poncet, 2018. "Looking for the Bright Side of the China Syndrome: Rising Export Opportunities and Life Satisfaction in China," Working Papers 2018-14, CEPII research center.
    16. Italo Colantone & Piero Stanig, 2016. "Global Competition and Brexit," BAFFI CAREFIN Working Papers 1644, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    17. Chiara Carboni & Elisabetta Iossa & Gianpiero Mattera, 2018. "Barriers towards foreign firms in international public procurement markets: a review," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 45(1), pages 85-107, March.
    18. Chiara Carboni & Elisabetta Iossa & Gianpiero Mattera, 2017. "Barriers to Public Procurement: A Review and Recent Patterns in the EU," IEFE Working Papers 92, IEFE, Center for Research on Energy and Environmental Economics and Policy, Universita' Bocconi, Milano, Italy.
    19. David Hummels & Jakob Munch & Chong Xiang, 2016. "No Pain, No Gain: Work Demand, Work Effort, and Worker Health," NBER Working Papers 22365, National Bureau of Economic Research, Inc.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Colantone, Italo & Crinò, Rosario & Ogliari, Laura, 2019. "Globalization and mental distress," Journal of International Economics, Elsevier, vol. 119(C), pages 181-207.
    2. Jonathan de Quidt & Johannes Haushofer, 2017. "Depression through the Lens of Economics: A Research Agenda," NBER Chapters, in: The Economics of Poverty Traps, pages 127-152, National Bureau of Economic Research, Inc.
    3. César, Andrés & Falcone, Guillermo & Gasparini, Leonardo, 2021. "Costs and benefits of trade shocks: Evidence from Chilean local labor markets," Labour Economics, Elsevier, vol. 73(C).
    4. Andrew N. Greenland & Mihai Ion & John W. Lopresti & Peter K. Schott, 2020. "Using Equity Market Reactions to Infer Exposure to Trade Liberalization," NBER Working Papers 27510, National Bureau of Economic Research, Inc.
    5. Jonathan de Quidt & Johannes Haushofer, 2016. "Depression for Economists," NBER Working Papers 22973, National Bureau of Economic Research, Inc.
    6. McManus, T. Clay & Schaur, Georg, 2016. "The effects of import competition on worker health," Journal of International Economics, Elsevier, vol. 102(C), pages 160-172.
    7. Luca Salvatici & Silvia Nenci, 2017. "New features, forgotten costs and counterfactual gains of the international trading system," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 44(4), pages 592-633.
    8. Andrés César & Guillermo Falcone, 2020. "Heterogeneous Effects of Chinese Import Competition on Chilean Manufacturing Plants," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Spring 20), pages 1-60, December.
    9. David H. Autor & David Dorn & Gordon H. Hanson, 2016. "The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade," Annual Review of Economics, Annual Reviews, vol. 8(1), pages 205-240, October.
    10. Italo Colantone & Alessia Matano & Paolo Naticchioni, 2020. "New imported inputs, wages and worker mobility," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(2), pages 423-457.
    11. Jérôme Adda & Yarine Fawaz, 2020. "The Health Toll of Import Competition," The Economic Journal, Royal Economic Society, vol. 130(630), pages 1501-1540.
    12. David Autor & Caroline Chin & Anna M. Salomons & Bryan Seegmiller, 2022. "New Frontiers: The Origins and Content of New Work, 1940–2018," NBER Working Papers 30389, National Bureau of Economic Research, Inc.
    13. Muendler, Marc-Andreas, 2017. "Trade, technology, and prosperity: An account of evidence from a labor-market perspective," WTO Staff Working Papers ERSD-2017-15, World Trade Organization (WTO), Economic Research and Statistics Division.
    14. Campbell, Douglas L., 2020. "Relative Prices and Hysteresis: Evidence from US Manufacturing," European Economic Review, Elsevier, vol. 129(C).
    15. Copestake, Alexander & Zhang, Wenzhang, 2023. "Inputs, networks and quality-upgrading: Evidence from China in India," China Economic Review, Elsevier, vol. 77(C).
    16. Richard Bräuer & Matthias Mertens & Viktor Slavtchev, 2023. "Import competition and firm productivity: Evidence from German manufacturing," The World Economy, Wiley Blackwell, vol. 46(8), pages 2285-2305, August.
    17. De Lyon, Josh & Pessoa, Joao Paulo, 2021. "Worker and firm responses to trade shocks: The UK-China case," European Economic Review, Elsevier, vol. 133(C).
    18. Elizabeth J. Casabianca & Alessia Lo Turco & Claudia Pigini, 2019. "Import penetration and returns to tasks: recent evidence from the Peruvian labour market," Empirical Economics, Springer, vol. 56(2), pages 551-617, February.
    19. Sónia Cabral & Pedro S. Martins & João Pereira dos Santos & Mariana Tavares, 2021. "Collateral Damage? Labour Market Effects of Competing with China—at Home and Abroad," Economica, London School of Economics and Political Science, vol. 88(350), pages 570-600, April.
    20. David Autor & David Dorn & Gordon H. Hanson & Gary Pisano & Pian Shu, 2020. "Foreign Competition and Domestic Innovation: Evidence from US Patents," American Economic Review: Insights, American Economic Association, vol. 2(3), pages 357-374, September.

    More about this item

    Keywords

    Individual-level panel data; Subjective well-being; Trade adjustment costs;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:10874. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://www.cepr.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.