Advanced Search
MyIDEAS: Login

Market Institutions, Labor Market Dynamics, Growth and Productivity: Argentina

Contents:

Author Info

  • Gabriel Sanchez
  • Ines Butler

Abstract

This paper seeks to shed light on how manufacturing job flows and productivity in Argentina were affected during the 1990s by economic reforms in general and particularly by: a) financial shocks, b) labor reforms that change non-wage labor costs, c) trade reforms that alter tariff dispersion, d) institutional features that affect the working of the credit, labor and goods markets. To this end, a “Constrained Panel Data Near Vector Autoregression†analysis is applied to a sample of 20 manufacturing industries for which data on jobs and productivity are available for the 1990-2001 period on a quarterly basis and different tests for the effect of reforms on job flows and productivity are performed. The main findings are that: - Shocks to the user cost of capital lower job creation, net employment growth and productivity and raise destruction. Increases in non-wage labor costs lead to bigger job destruction and reallocation and to smaller net employment and productivity. Lower sectoral tariffs raise job destruction, reallocation and productivity and reduce net employment growth. - Industries with bigger access to banking credit are more hard hit by financial shocks, but are are able to raise more their net employment growths in response to reductions in non-wage labor costs and sectoral tariff hikes. The presence of workers with larger bargaining power leads to bigger declines in job creation, net employment growth and job reallocation in response to negative profitability shocks. More open industries restructure more and experience smaller productivity declines in response to negative profitability shocks. These sectors raise net employment growth more when non-wage labor costs are reduced. - Increased reallocation within the manufacturing sector as a whole is seen to contribute to bigger increases (or smaller declines) in productivity in response to the different shocks. Although a majority of industries also display a positive contribution of reallocation to productivity in response to most shocks, there is substantial heterogeneity of behavior at this level. - The reforms in the areas of trade policy (formation of Mercosur) and labor taxes and regulations (lower taxation and more flexibility) after 1995, together with the increased reliance on banking credit, changed the nature of the responses of job flows to the different policy and cyclical shocks. - During 1995-2001 destruction rises more in response to negative profitability shocks, reflecting the more flexible labor regulations. This bigger labor market flexibility also appears to have led to a bigger synchronization of creation and destruction in response to non-wage labor shocks. The bigger reliance on banking credit and the bigger sensitivity to losses of international competitiveness due to Mercosur made net employment growth and reallocation decline more in response to adverse shocks to the cost of capital.

Download Info

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Bibliographic Info

Paper provided by Econometric Society in its series Econometric Society 2004 Latin American Meetings with number 38.

as in new window
Length:
Date of creation: 11 Aug 2004
Date of revision:
Handle: RePEc:ecm:latm04:38

Contact details of provider:
Phone: 1 212 998 3820
Fax: 1 212 995 4487
Email:
Web page: http://www.econometricsociety.org/pastmeetings.asp
More information through EDIRC

Related research

Keywords: gross job flows; creative destruction; productivity; vector autoregression; economic reforms;

Find related papers by JEL classification:

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Castro, Lucio & Olarreaga, Marcelo & Saslavsky, Daniel, 2006. "The impact of trade with China and India on Argentina’s manufacturing employment," MPRA Paper 538, University Library of Munich, Germany.
  2. Alejandro Micco & Carmen Pagés-Serra, 2004. "Employment Protection and Gross Job Flows: A Differences-in-Differences Approach," Research Department Publications 4365, Inter-American Development Bank, Research Department.
  3. Echavarría Juan José & María Angélica Arbeláez & María Fernanda Rosales, 2006. "La productividad y sus determinantes:el caso de la industria colombiana," REVISTA DESARROLLO Y SOCIEDAD, UNIVERSIDAD DE LOS ANDES-CEDE.
  4. Alejandro Micco & Carmen Pagés-Serra, 2004. "Protección del empleo y flujo bruto de puestos de trabajo: un enfoque de diferencias en diferencias," Research Department Publications 4366, Inter-American Development Bank, Research Department.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ecm:latm04:38. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F. Baum).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.