According to the official website of JDE, the paper titled "Trade liberalization, labor market power, and misallocation across firms: Evidence from China's WTO accession", co-authored by Xie Enze from Zhejiang University, Xu Mingzhi from Peking University, and Yu Miaojie from Liaoning University, has been officially published online in the top journal in the field of development economics, the Journal of Development Economics.

Title: Trade liberalization, labor market power, and misallocation across firms: Evidence from China's WTO accession

Abstract: This paper studies the impact of trade liberalization on the heterogeneity of labor market power among manufacturing firms, which is a potential source of misallocation. The model shows that heterogeneity of labor market power distorts the allocation of the factors of production, and the variance in the natural log of the markdown serves as a sufficient statistic to infer its negative impact on overall production efficiency. Using China's accession to the World Trade Organization (WTO) as a natural experiment, the empirical results suggest that lower input tariffs decrease the variance in the natural log of the markdown, which reflects the improvement in misallocation. In contrast, reductions in output tariffs have no significant effects.

Introduction to the Authors

Xie Enze--Zhejiang University

Xu Mingzhi--Beijing University

Yu Miaojie--Deputy Secretary of the Party Committee and President of Liaoning University