We examine voting and roll-call votes in the United States over a twenty-five year period. Voters... more We examine voting and roll-call votes in the United States over a twenty-five year period. Voters in areas more exposed to trade liberalization with China in 2000 subsequently shift their support towards Democrats, relative to the 1990s, though this boost for Democrats wanes after the rise of the Tea Party in 2010. House members’ votes in Congress rationalize these trends, with Democratic representatives disproportionately supporting protection during the early 2000s. Together, these results imply that voters in areas subject to higher import competition shifted votes toward the party more likely to restrict trade. ∗We thank participants at many seminars and conferences for helpful comments, and Benjamin Poon, Jacob Williams, and Jingyi Xie for outstanding research assistance. Any opinions and conclusions expressed herein are those of the authors and do not necessarily represent the views of the Board of Governors or its research staff. †Antai College of Economics and Management, Sh...
Franchising involves a variety of contractual and ownership arrangements within a single company.... more Franchising involves a variety of contractual and ownership arrangements within a single company. In recent years, a great deal of e®ort has been made to understand this increasingly popular organization (Lafontaine, 1992, 1993, and Lafontaine and Slade, 1997). There are at least two stylized facts that have posed challenges to the existing theories of the ̄rm. One is the co-existence of company-owned and franchised units, and the other is that franchisees make substantial amount of investment highly speci ̄c to their franchise companies. We set out to explain both puzzles based on the importance of the brand name in franchising (Kaufmann and Lafontaine, 1994). The e®ort to develop and maintain the brand name changes over time and is di±cult to verify (Had ̄eld, 1990), which has two implications. One is that agents who run franchise units need to be given appropriate incentives for the brand-name-maintenance e®ort. The other is that franchising contracts are incomplete. For incentiv...
Abstract Using Chinese customs data covering all exporters over 2000–06, this paper empirically i... more Abstract Using Chinese customs data covering all exporters over 2000–06, this paper empirically investigates how Chinese multi-product exporters adjust their product scope and product mix to react to U.S. antidumping. The estimation results indicate that surviving exporters experiencing antidumping would reduce their overall export product scope and concentrate on fewer more successful products, although the overall export value does not change. Specifically, they drop many pre-existing peripheral export products and simultaneously introduce new products that are closer to their main industry into the U.S. market. The analysis also finds that the sophistication of surviving exporters' export product mix increases in response to antidumping, and they export more products that have higher upstreamness.
A unanimous finding in the literature on firm heterogeneity and exporting behavior is that export... more A unanimous finding in the literature on firm heterogeneity and exporting behavior is that exporters are more productive than non-exporters. Subsequent empirical studies reveal that more productive firms self-select their status as exporters in the presence of fixed costs for exporting, thereby explaining the positive correlation between firm productivity and exporting behavior. Using data from China's Annual Survey of Industrial firms from 1998 to 2005, however, we find strikingly different patterns of firm productivity and exporting behavior between China's indigenous firms and foreign multinationals operating in China. Among China's indigenous firms, exporters are indeed more productive than non-exporters, and the more productive firms self-select their status as exporters. But the results for foreign multinationals are just the opposite: exporters are less productive than non-exporters, and the less productive firms self-select their status as exporters. We then prop...
We examine voting and roll-call votes in the United States over a twenty-five year period. Voters... more We examine voting and roll-call votes in the United States over a twenty-five year period. Voters in areas more exposed to trade liberalization with China in 2000 subsequently shift their support towards Democrats, relative to the 1990s, though this boost for Democrats wanes after the rise of the Tea Party in 2010. House members’ votes in Congress rationalize these trends, with Democratic representatives disproportionately supporting protection during the early 2000s. Together, these results imply that voters in areas subject to higher import competition shifted votes toward the party more likely to restrict trade. ∗We thank participants at many seminars and conferences for helpful comments, and Benjamin Poon, Jacob Williams, and Jingyi Xie for outstanding research assistance. Any opinions and conclusions expressed herein are those of the authors and do not necessarily represent the views of the Board of Governors or its research staff. †Antai College of Economics and Management, Sh...
Franchising involves a variety of contractual and ownership arrangements within a single company.... more Franchising involves a variety of contractual and ownership arrangements within a single company. In recent years, a great deal of e®ort has been made to understand this increasingly popular organization (Lafontaine, 1992, 1993, and Lafontaine and Slade, 1997). There are at least two stylized facts that have posed challenges to the existing theories of the ̄rm. One is the co-existence of company-owned and franchised units, and the other is that franchisees make substantial amount of investment highly speci ̄c to their franchise companies. We set out to explain both puzzles based on the importance of the brand name in franchising (Kaufmann and Lafontaine, 1994). The e®ort to develop and maintain the brand name changes over time and is di±cult to verify (Had ̄eld, 1990), which has two implications. One is that agents who run franchise units need to be given appropriate incentives for the brand-name-maintenance e®ort. The other is that franchising contracts are incomplete. For incentiv...
Abstract Using Chinese customs data covering all exporters over 2000–06, this paper empirically i... more Abstract Using Chinese customs data covering all exporters over 2000–06, this paper empirically investigates how Chinese multi-product exporters adjust their product scope and product mix to react to U.S. antidumping. The estimation results indicate that surviving exporters experiencing antidumping would reduce their overall export product scope and concentrate on fewer more successful products, although the overall export value does not change. Specifically, they drop many pre-existing peripheral export products and simultaneously introduce new products that are closer to their main industry into the U.S. market. The analysis also finds that the sophistication of surviving exporters' export product mix increases in response to antidumping, and they export more products that have higher upstreamness.
A unanimous finding in the literature on firm heterogeneity and exporting behavior is that export... more A unanimous finding in the literature on firm heterogeneity and exporting behavior is that exporters are more productive than non-exporters. Subsequent empirical studies reveal that more productive firms self-select their status as exporters in the presence of fixed costs for exporting, thereby explaining the positive correlation between firm productivity and exporting behavior. Using data from China's Annual Survey of Industrial firms from 1998 to 2005, however, we find strikingly different patterns of firm productivity and exporting behavior between China's indigenous firms and foreign multinationals operating in China. Among China's indigenous firms, exporters are indeed more productive than non-exporters, and the more productive firms self-select their status as exporters. But the results for foreign multinationals are just the opposite: exporters are less productive than non-exporters, and the less productive firms self-select their status as exporters. We then prop...
Uploads
Papers by Zhigang Tao