The Negative Impact of the U.S. - China Trade War on Chinese Firms

This paper examines the effect of the U.S-China trade war on Chinese firms. I use quarterly data on more than two thousand listed firms to document that firms in industries with a higher share of output exported to the U.S. have had lower revenue and profits since the start of the trade war. This has been especially the case for businesses producing consumer and industrial durables. U.S. tariffs have had heterogeneous impacts on Chinese firms, hurting mostly larger firms. To a smaller extent, Chinese tariffs have benefited firms of all sizes equally.