Centre for the Study of Living Standards
Centre d’étude des niveaux de vie
Andrew Sharpe (Executive Director/Directeur exécutif)
Don Drummond (Chair/Président)

604-170 Laurier Ave. WOttawa, Ontario
K1P 5V5

Board of Directors/Conseil d’administration
Jock Finlayson
Maureen O’Neil
Chris Ragan
Pierre Fortin
Lars Osberg
Richard Van Loon
Helen Heslop
Craig Riddell
Frances Woolley
Michael Horgan

Telephone: 613-233-8891
csls@csls.ca
www.csls.ca

Canadians Gained as well as Lost from the China Shock
Press Release - Ottawa, June 9, 2020
The Centre for the Study of Living Standards (CSLS) today released a study prepared for Global Affairs
Canada entitled “​The Price Effect of Trade: Evidence from the China Shock and Canadian ConsumerPrices”​ .
There have been benefits as well as costs to Canadians from a surge of Chinese imports after China joined
the World Trade Organisation in 2001. There is no shortage of research on the costs, which include job
losses in manufacturing. This study is the first to take a detailed look at the benefits, which include lower
prices for some products and lower inflation overall.
This study by Myeongwan Kim, an economist at Centre for the Study of Living Standards, focuses on theperiod between 2001 and 2011, a time when Chinese-made goods were occupying more and more spacein the shopping baskets of Canadians.
The key findings from this study are highlighted below:●●Imports from China caused prices to drop or rise more slowly on a range of goods, most notably
consumer products related to textiles, clothing, furniture and electronics. Advances in technology,
some related to the import influx, played a role in depressing prices. Rising imports from China
meant that the price of digital computing equipment and devices was almost five per-cent lower
than it would have been in 2011 if Chinese imports had remained at their 2001 level. The price ofbedding and household textiles was just over four-per-cent less and upholstered furniture costalmost four per-cent less.
The higher the Chinese share in total imports of a given product, the larger the price decrease. On
average, a one-percentage-point increase in the Chinese share in total imports of a given product●

led to a 0.221-percentage-point decrease per year in its consumer price. For the total consumer
price index, which includes services as well as goods, cumulative inflation would have been
higher by 1.17 percentage points in 2011 had the Chinese share in total goods imports in Canada
remained at the 2001 level.
A previous study by Mr Kim indicated that the influx of Chinese goods likely led to the loss of113,500 manufacturing jobs during this period. This study estimates that lower inflation rates
over the period translate into a cumulative gain of $546 per Canadian worker or $76,996 (in 2002dollars) for every job lost. The average annual wage for a manufacturing worker during the period
was $42,868 (in 2002 dollars).

The report is posted at ​http://www.csls.ca/reports/csls2020-02.pdf​.
For further information, please contact:

Andrew Sharpe
Executive Director
Centre for the Study of Living Standards
613-233-8891
andrew.sharpe@csls.ca
The Centre for the Study of Living Standards (CSLS) is a national, independent, Ottawa-based
not-for-profit research organization. Its primary objective is to contribute to a better understanding oftrends and determinants of productivity, living standards, and economic wellbeing in Canada throughresearch.