Imports and New Technology: Sources of Injury in the Traditional Steel Industry

This paper explores whether imports or new technology has played a greater role in the recent restructuring of the American steel industry. A modified version of an injury index model developed by Pindyk and Rotemberg (1987) is used to analyze the comparative impact of steel imports and thin-slab minimills on capacity utilization rates in the flat-rolled steel industry. The analysis finds that, while rising import levels may have aggravated the decline of traditional steel production, the emergence of minimill production methods are a more fundamental cause of declining capacity utilization rates in the traditional steel sector.