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Trade liberalization, Firm Performances and Labor Market Outcomes in the Developing World, what Can We Learn From Micro-Level Data?

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  • Epifani Paolo

Abstract

We review the micro-level evidence on the effects of trade and investment liberalization in the developing world. The basic findings are the following. There is evidence of trade-induced productivity gains. These gains mainly stem from output share reallocations among firms with different productivity levels and are larger in import competing sectors. There is no evidence of significant scale efficiency gains. There is evidence of a strong pro-competitive effect of trade liberalization. There is no evidence either of learning-by-exporting effects or of beneficial spillover effects from foreign owned to local firms. There is evidence of skill upgrading induced by the reallocation of market shares in favor of plants with higher skill-intensity. There is no evidence either of trade-induced increases in labor demand elasticities or of substantial employment contraction in import competing sectors.

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Bibliographic Info

Article provided by Società editrice il Mulino in its journal Rivista italiana degli economisti.

Volume (Year): (2003)
Issue (Month): 3 ()
Pages: 455-486

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Handle: RePEc:mul:jqat1f:doi:10.1427/12530:y:2003:i:3:p:455-486

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Cited by:
  1. Pierre, Gaelle & Scarpetta, Stefano, 2004. "Employment regulations through the eyes of employers - do they matter and how do firms respond to them?," Policy Research Working Paper Series 3463, The World Bank.
  2. Sule Ozler & Kamil Yilmaz, 2009. "Productivity response to reduction in trade barriers: evidence from Turkish manufacturing plants," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 145(2), pages 339-360, July.
  3. Pierre, Gaelle & Scarpetta, Stefano, 2007. "How labor market policies can combine workers'protection with job creation : a partial review of some key issues and policy options," Social Protection Discussion Papers 41439, The World Bank.
  4. Petia Topalova, 2004. "Trade Liberalization and Firm Productivity: The Case of India," IMF Working Papers 04/28, International Monetary Fund.
  5. Jagadeesh Sivadasan & Joel Slemrod, 2006. "Tax Law Changes, Income Shifting and Measured Wage Inequality: Evidence from India," NBER Working Papers 12240, National Bureau of Economic Research, Inc.
  6. Boubakri, Narjess & Cosset, Jean-Claude & Guedhami, Omrane, 2005. "Liberalization, corporate governance and the performance of privatized firms in developing countries," Journal of Corporate Finance, Elsevier, vol. 11(5), pages 767-790, October.
  7. Gibson, Bill, 2005. "The transition to a globalized economy: Poverty, human capital and the informal sector in a structuralist CGE model," Journal of Development Economics, Elsevier, vol. 78(1), pages 60-94, October.
  8. Aldaba, Rafaelita M., 2010. "Does Trade Protection Improve Firm Productivity? Evidence from Philippine Micro Data," Discussion Papers DP 2010-32, Philippine Institute for Development Studies.
  9. Meschi, Elena & Vivarelli, Marco, 2007. "Globalization and Income Inequality," IZA Discussion Papers 2958, Institute for the Study of Labor (IZA).
  10. Meschi, Elena & Vivarelli, Marco, 2009. "Trade and Income Inequality in Developing Countries," World Development, Elsevier, vol. 37(2), pages 287-302, February.
  11. Elena Meschi & Erol Taymaz & Marco Vivarelli, 2010. "Trade, Technology And Skills: Evidence From Turkish Microdata," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1062, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
  12. Puja Vasudeva Dutta, 2007. "Trade Protection and Inter-Industry Wages in India," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 60(2), pages 268-286, January.
  13. Gunjan Sharma, 2006. "Competing or Collaborating Siblings? Industrial and Trade Policies in India," Working Papers 0610, Department of Economics, University of Missouri.

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