The Impact of Sino-US Trade Friction on the Total Factor Productivity of Manufacturing Enterprises in China

Qiuqi Wu; Yunan Wang

doi:10.63313/FPM.9010

Authors

Qiuqi Wu Foshan University, Foshan, China Author
Yunan Wang Foshan University, Foshan, China Author

DOI:

https://doi.org/10.63313/FPM.9010

Keywords:

Sino-Us Trade Friction, Total Factor Productivity, Manufacturing, Difference-In-Differences Mode

Abstract

This study examines the impact of the 2018 Sino-US trade friction on the total factor productivity (TFP) of manufacturing firms. Employing a multi-period difference-in-differences model and drawing on theories of creative destruction and growth options, we analyze data from A-share listed manufacturing firms in China from 2014 to 2023. Our findings indicate that: (1) The trade friction exerted a significant forcing effect, compelling firms to improve their TFP. (2) The underlying mechanisms include enhanced asset operational efficiency, intensified innovation efforts, and increased competitive pressure within industries. This research provides micro-level evidence and policy insights for governments to design targeted and differentiated policies aimed at stimulating firms' endogenous dynamism and systematically strengthening the resilience of the manufacturing sector in complex international trade environments.

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