WANG Yulin - Research

Working Papers

Trade Policy Uncertainty and Supply Chain Disruptions: Firm-Level Evidence from "Liberation Day," with Gustavo De Souza, Harry Haishi Li, Ziho Park , SSRN [New Paper!]

Abstract: On April 2, 2025, U.S. President Donald Trump announced the “Liberation Day” tariffs, creating an unexpected, precisely timed, and country-specific episode of trade policy uncertainty. The proposal threatened U.S. trade partners with additional tariffs ranging from 10% to 50%, depending on the outcome of bilateral negotiations. Using transaction-level U.S. import data, we find that firms rapidly shifted sourcing from countries facing high tariff risk to those facing low tariff risk. Firms didn’t change their total import values but this reallocation came at the cost of higher import prices. Firms with relationship-sticky, contract-dependent, and trade finance-intensive supply chains drove this preemptive reallocation, consistent with their being most vulnerable had tariffs been implemented before they could reallocate. Our findings demonstrate that even brief periods of trade policy uncertainty can significantly disrupt supply chains.

To Comply or Not to Comply: Understanding Neutral Country Supply Chain Responses to Russian Sanctions, with Harry Haishi Li, Zhi Li, Ziho Park, Jing Wu, SSRN, VoxEU

Abstract: Using transaction-level trade data from major non-sanctioning countries, we study how firms responded to export sanctions against Russia since 2022. Firms headquartered in sanctioning countries reduced their sanctioned exports, highlighting multinationals' geopolitical influence. However, domestically headquartered firms increased their sanctioned exports. Domestic firms with higher exports to sanctioning countries showed better compliance, underscoring the importance of limiting violators' market access. In contrast, firms sourcing more inputs from sanctioning countries rerouted sanctioned products to Russia. Sanctioning multinationals expanded exports to both sanctioning and Russia-friendly countries, blending compliance and evasion. These findings suggest stronger secondary sanctions and multinational involvement are essential.

Accepted and Published Papers

We Are All in the Same Boat: Cross-Border Spillovers of Climate Shocks Through International Trade and Supply Chain, with Harry Haishi Li, Alan Xiaochen Feng, Economic Journal, July 2025, selected as the editor's choice article. link to the paper

Abstract: Are landlocked countries at risk from sea-level rise? We identify a new mechanism where natural disaster shocks influence countries' macroeconomic performance through cross-border trade spillovers. Analyzing global data on climate disasters, infrastructure, trade, and the macroeconomy from 1970 to 2019, we find that climate disasters impacting ports, critical infrastructure for international trade, reduce imports, exports, and economic output in both the affected country and its major trade partner (both upstream and downstream) countries. The GDP effects on main upstream and downstream countries are as large as those in directly impacted countries: While directly affected countries offset climate disaster damages with increased government spending and investment, trade partners do not. Effective adaptation efforts, including building climate-resilient infrastructure and implementing disaster relief measures, must account for the cross-border spillover effects of climate disasters.

Unraveling Regional Inequality: The Heterogeneous Impact of China's Great Western Development Program, with Pengyu Zhu, Yatang Lin, Regional Studies, 2025, journal link

Abstract: This paper studies China’s Great Western Development Program, which was designed to promote growth in the backward western provinces. In addition to evaluating its original policy goal, we further investigate its unintended consequences and potential mechanisms. Employing a regression discontinuity design and nightlight series data, we find that the program led to a 1.3-1.7% faster annual output growth in China’s western region. Though the financial investment is homogenous, the positive growth effects are limited to localities with better initial endowments. We suggest that the program has widened inequality within the treatment group due to lack of targeting.

Effects of Public Subsidies on Hospital Management in China (IN CHINESE) , with YUE Yang, ZHU Hengpeng, Economic Research Journal (经济研究), March 2023

Abstract: The paper seeks to investigate the impact of public subsidies on hospital management in China, including how subsidies affect hospital spending behavior, operational efficiency, and market share. The study uses a combination of theoretical and empirical methods to answer this question and provide insights that can inform policy decisions aimed at improving healthcare delivery in China. The main conclusion of this study is that fiscal subsidies have a negative impact on the operational behavior and efficiency of public hospitals. Specifically, increasing fiscal subsidies to hospitals results in an expansion of their loss scale and a decrease in their operational efficiency. Simultaneously, we find that the effects of fiscal subsidies vary among hospitals of different sizes and types. These findings have significant implications for the formulation of fiscal subsidy policies for public hospitals and for improving their operational efficiency.

Work in Progress

Conglomerate and Innovation, with Xiaomei Sui
Learning through Imitation: The Case of Mobile Phones