Working Papers

EII Working Paper 19-01

Recalculating the China Shock to US Manufacturing Employment (April 2019; rev. Sep.)

(William R. Cline with David Xu)       This study uses counterfactual input-output analysis rather than statistical regressions to estimate the employment impact of the large increase in imports from China.  For 2000-16, it estimates a loss of about 775,000 jobs in manufacturing and about 750,000 for the economy as a whole, well below the corresponding estimates of 1 million and 2 million respectively in the leading previous study. The lower estimates stem from inclusion of induced export job gains, deflection of imports otherwise provided by countries competing with China, and new jobs in downstream sectors benefiting from cheaper imported intermediate inputs.  Available at EIIWP19-01Rsep.

EII Financial Markets Analysis 19-01: Justified Stock Market Price, January 2019

Following the fourth-quarter correction in the US stock market, the JSMP model indicated substantial scope for market appreciation in 2019 even allowing for a significant price discount from heightened political risk.  Available at EIIFMA19-01.

EII Financial Markets Analysis 18-02: Estimates of Fundamental Equilibrium Exchange Rates, November 2018

In October, 2018, the US dollar was marginally overvalued, the Japanese yen and Korean won moderately undervalued, and the euro and Chinese renminbi were at fundamental equilibrium levels. Available at EIIFMA18-02.  To commission a specially-tailored report using a more recent base month, incorporating additional countries, or addressing specific issues, please contact wrc@econintl.com.

EII Working Paper 18-01

US Median Household Income Has Risen More Than You Think (October 2018)

After changing the price deflator from the consumer price index to the personal consumption expenditure index, and after adjusting for changing household size, trendline real median household income rose by 50 percent from the late 1960s to 2017, instead of just 21 percent as reported by Census.  Available at this link: EIIWP18-01f.

This paper was subsequently published in the Winter 2019 issue of the Cato Journal and is available at this link.

EII Financial Markets Analysis 18-01:  Justified Stock Market Price, October 2018 

Despite moderate overvaluation at end-2017, by end-September 2018 this overvaluation had diminished and US stock prices were on track to rise significantly through end-2019 as major increases in earnings more than offset normalization of price-earnings ratios.  Available at: EIIFMA18-01.