An empirical exploration of Chinese imports and the US steel industry
by Myeong Hwan Kim; Yongseung Han; Carolyn Fabian Stumph
International Journal of Trade and Global Markets (IJTGM), Vol. 9, No. 3, 2016

Abstract: The paper identifies four key issues concerning the relationship between Chinese imports and the US steel industry: currency manipulation, state-owned enterprises, subsidisation, and environmental regulations. Given these issues, we run a regression to empirically explore the relationship between Chinese imports and US steel prices. We found that Chinese imports have two conflicting effects: one is to lower US steel prices while the other is to increase the prices via China's increasing market share. The overall impact is that Chinese imports increase US steel prices, as the effect due to market share is larger than the demand effect. With these findings, we suggest that, of the four effects considered, Chinese subsidisation is the most crucial.

Online publication date: Sun, 17-Jul-2016

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