Import competition and the gender gap in labor force participation: Evidence from China

Does import competition explain the gender gap in labor force participation? The distributional consequences of trade liberalization have fascinated decades of economists and policy makers. Using a difference-in-differences strategy, we find that import competition enlarges the gender gap in labor force participation in China during 1990 and 2005. The results are robust to various identification challenges, including contemporaneous confounders, treatment effect heterogeneity, and spatial correlations in standard errors. The magnitude of the gender-differential effects of import competition on labor force participation grows by age, and peaks for people aged 46-50. The household division of labor appears to explain the gender-differential effects. Import competition also leads to a relative contraction of female-intensive industries, and reduces the share of female employees in each industry.