Discussion paper
DP20161 The US-China Trade War Creates Jobs (Elsewhere)
We examine the indirect effects of the US-China trade war on Brazil’s labor market. Using industry-specific tariff changes and the sectoral employment distribution across local labor markets, we construct a measure of regional exposure to the trade conflict. Following higher exports to China, our findings reveal that regions more exposed to Chinese retaliatory tariffs on US exports experienced a relative increase in formal employment and wage bills. In contrast, American tariffs on Chinese exports had no significant impact on Brazilian labor markets. These results contribute to a better understanding of the intricate worldwide implications of bilateral trade wars.
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