Chinese import competition, crime, and government transfers in US

This paper exploits the exogenous rise of Chinese imports in US to investigate the effect of import competition on crime at the county level. The results indicate that counties with high exposure to Chinese import competition have high crime rates. The exposure effect on property crime is much larger than that on violent crime. A one standard deviation increase in exposure causes 32 more violent crimes in the county, while such increase in exposure causes 256 more property crimes. Interestingly, we find that the crime impact of exposure to Chinese import competition becomes smaller in counties with high government transfers.