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Trade Liberalization, The Exchange Rate And Job And Worker Flows In Brazil

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Author Info
Eduardo Pontual Ribeiro
Carlos H. Corseuil
Daniel Santos
Paulo Furtado
Brunu Amorim
Luciana Servo
André Souza

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Abstract

Over the 1990's Brazil experienced a massive trade liberalization and wide variation in the real exchange rate. At the same time, employment growth was small and in manufacturing there was a significant reduction in total manufacturing. The main goal of this article is to idntify the effects of the exchange rate and trade liberalization on job and worker flows in Brazil. Using a novel sector exchange rate measure, our results suggest that a depreciation of the exchange rate affects net employment growth by increasing job creation and hires, with no effect on job reallocation. Tariffs have no effect on job or worker flows, while import penetration decrease job growth by increasing job destruction. The results suggest that the echange rate have a very important role on job and worker flows, even after controlling for openess and sector specificities.

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Paper provided by ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics] in its series Anais do XXXII Encontro Nacional de Economia [Proceedings of the 32th Brazilian Economics Meeting] with number 153.

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Date of creation: 2004
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Handle: RePEc:anp:en2004:153

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J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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  5. Michael W. Klein & Scott Schuh & Robert K. Triest, 2000. "Job Creation, Job Destruction, and the Real Exchange Rate," NBER Working Papers 7466, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Moreira, Mauricio Mesquita & Correa, Paulo Guilherme, 1998. "A first look at the impacts of trade liberalization on Brazilian manufacturing industry," World Development, Elsevier, vol. 26(10), pages 1859-1874, October. [Downloadable!] (restricted)
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  10. Sergei Soares & Luciana M. Santos Servo & Jorge Saba Arbache, 2001. "O que (não) Sabemos sobre a Relação entre Abertura Comercial e Mercado de Trabalho no Brasil," Anais do XXIX Encontro Nacional de Economia [Proceedings of the 29th Brazilian Economics Meeting] 048, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics]. [Downloadable!]
  11. Fajnzylber, Pablo & Maloney, William F. & Ribeiro, Eduardo, 2001. "Firm entry and exit, labor demand, and trade reform : evidence from Chile and Colombia," Policy Research Working Paper Series 2659, The World Bank. [Downloadable!]
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  14. Mortensen, Dale T. & Pissarides, Christopher A., 1999. "Job reallocation, employment fluctuations and unemployment," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 18, pages 1171-1228 Elsevier. [Downloadable!] (restricted)
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