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Papers by Benjamin Liebman

SSRN Electronic Journal, 2022

This paper investigates the impact of trade protection on Chinese steel prices. The paper sheds l... more This paper investigates the impact of trade protection on Chinese steel prices. The paper sheds light on the relatively new Chinese steel futures market for concrete reinforcing bar (rebar), which has quickly become the most highly traded metal future in the world and yet has received very little attention in the academic literature. Moreover, the paper contributes to the existing literature on the consequences of trade protection by observing the behaviors of both spot and futures markets in response to trade measures. How do Chinese steel spot and futures markets react to President Trump’s Section 232 tariffs, as well as those implemented by policymakers in other countries? Our empirical results indicate that Chinese futures prices respond negatively to foreign trade protection, while spot prices exhibit little response to the implementation of foreign duties. We also find that equity prices of large Chinese steel firms decline in response to duties. Finally, our results indicate ...

... University of Oregon and National Bureau of Economic Research Benjamin Liebman Saint Joseph... more ... University of Oregon and National Bureau of Economic Research Benjamin Liebman Saint Joseph University and Wesley W. Wilson § University of Oregon March 2009 Abstract Over the last 50 years, the US integrated steel industry has been in a marked state of decline. ...

SSRN Electronic Journal, 2020

Although trade wars have existed throughout modern history, there is little empirical evidence as... more Although trade wars have existed throughout modern history, there is little empirical evidence as to how countries choose which industries to target for retaliatory tariffs. We develop a political economy model of trade policy to explain a country’s choice of product for retaliation and test the implications of this model using the choices of seven countries in two retaliation episodes: (1) the US imposition of steel and aluminum tariffs in 2018 and (2) the US passage of the Continued Dumping and Subsidy Offset Act (CDSOA) in 2000. The empirical results from a binary choice regression indicate that countries are more likely to sanction products with higher trade values and those in which they can extract terms-of-trade welfare, suggesting that trade wars move countries back to a terms-of-trade driven prisoner’s dilemma equilibrium. We find a significant amount of heterogeneity in the degree to which countries consider the political importance of the industry when developing their retaliation list; while countries such as the EU and Canada clearly targeted politically important industries in 2018, we find little evidence that emerging markets did so. There is also little evidence that the EU and Canada targeted politically important industries in retaliation against the CDSOA.

The World Economy, 2015

ABSTRACT

Review of Industrial Organization, 2013

We present and examine a novel data set that contains production line information inside U.S. ste... more We present and examine a novel data set that contains production line information inside U.S. steel plants. We exploit this highly disaggregated data to perform the first study of entry and exit behavior at the level of the production line within individual plants. Our empirical analysis reveals a number of interesting results. First, smaller production lines are more likely to shut down, as are lines that are owned by larger firms. Younger production lines and lines that have undergone modernization are more likely to survive. Our results indicate that lines that are operated by integrated producers are more likely to exit. We find no evidence, however, that antidumping decreases the likelihood of exit, despite the steel industry's frequent use of antidumping protection.

NOTE: Staff working papers in the Finance and Economics Discussion Series (FEDS) are preliminary ... more NOTE: Staff working papers in the Finance and Economics Discussion Series (FEDS) are preliminary materials circulated to stimulate discussion and critical comment. The analysis and conclusions set forth are those of the authors and do not indicate concurrence by other members of the research staff or the Board of Governors. References in publications to the Finance and Economics Discussion Series (other than acknowledgement) should be cleared with the author(s) to protect the tentative character of these papers.

This is the first empirical study to examine Congressional support of an antidumping law that dir... more This is the first empirical study to examine Congressional support of an antidumping law that directs the U.S. Customs Service to distribute collected duties to protected firms. The law produces a highly transparent measure of how much each firm is rewarded for its rent-seeking efforts to secure the bill's passage. Therefore, this policy provides researchers with a unique setting in which to study the link between campaign contributions, Congressional behavior, and the subsequent financial returns to firms. Our empirical results show that campaign contributions from potential beneficiaries increased the likelihood that lawmakers would sponsor the law, and political contributions from the law's beneficiaries increased with the rewards that they expected to receive.

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Readers may make verbatim copies of this document for non-commercial purposes by any means, provi... more Readers may make verbatim copies of this document for non-commercial purposes by any means, provided that this copyright notice appears on all such copies.

This is the first paper to study the impact of long-term tariff reductions on capital spending by... more This is the first paper to study the impact of long-term tariff reductions on capital spending by U.S. manufacturers. We investigate fluctuations in investment for approximately 400 different 4-digit industries during the period 1974-2005. Our results indicate that the dismantling of tariff and quota protection had a stimulatory effect on U.S. manufacturing investment. The growth of Chinese imports also appears to have spurred investment. In contrast, imports from Tiger economies are associated with reduced investment by U.S. manufacturers.

We investigate the response of US trucking firms to the removal of barriers to cross-border truck... more We investigate the response of US trucking firms to the removal of barriers to cross-border trucking under NAFTA. This was done via a program implemented in 2007, cancelled in 2009, and reinstated in 2011. We find that, unsurprisingly, the program’s start resulted in lower stock returns, particularly for border firms. However, later policy changes indicate that investors, and particularly those in US multinationals, viewed the pilot as beneficial. We use a model of endogenous exporting to show that this can arise from incorrect expectations of import competition.

This paper explores the nature of exit barriers in the steel industry, their social and economic ... more This paper explores the nature of exit barriers in the steel industry, their social and economic implications, and policy approaches to deal with exits and steel industry restructuring. Barriers to exit in the steel industry require attention due to their negative impacts on excess capacity. Such barriers mainly stem from government interventions that hinder the closure of inefficient or unviable steel plants, though cost factors specific to the steel industry are important barriers, as well. Exits may also entail important costs associated with redundancy payments to workers, environmental clean-up and operations to dismantle mills. The paper concludes with specific policy recommendations to promote adjustment, including removing subsidies and other government support measures that maintain unviable plants, assisting displaced steel workers into other activities, and other measures to limit the social costs of steel plant closures.

The Journal of International Trade & Economic Development

We investigate the response of US trucking firms to the removal of barriers to crossborder trucki... more We investigate the response of US trucking firms to the removal of barriers to crossborder trucking under NAFTA. This was done via a program implemented in 2007, cancelled in 2009, and reinstated in 2011. We find that, unsurprisingly, the program's start resulted in lower stock returns, particularly for border firms. However, later policy changes indicate that investors, and particularly those in US multinationals, viewed the pilot as beneficial. We use a model of endogenous exporting to show that this can arise from incorrect expectations of import competition.