This paper finds that the evidence for the home market effect (HME) found by Hanson and Xiang (AER, 2004) is sensitive to the way the dependent and the independent variables are constructed. Second, we also find that the HME evidence goes away when we estimate their difference-in-difference...

We estimate the extent to which firms responded to tariff reductions associated with China’s WTO entry by altering labor’s share of value. Firm-level regressions indicate that firms in industries subject to tariff cuts raised labor’s share relative to economy-wide trends, both through...

In this paper, we reexamine closely the empirical evidence for the home-market effect (HME) found by Hanson and Xiang (American Economic Review, 2004). We first show that evidence for the HME from their difference-in-difference gravity equation is sensitive to the way the independent variable of...

We estimate the extent to which firms responded to tariff reductions associated with China's WTO entry by altering labor's share of value. Firm-level regressions indicate that firms in industries subject to tariff cuts raised labor's share relative to economy-wide trends, both through input...