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Globalization, Wages, and Working Conditions: A Case Study of Cambodian Garment Factories

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  • Cael Warren
  • Raymond Robertson

Abstract

The authors use a comprehensive data set of working conditions and wage compliance in Cambodia’s exporting garment factories to explore (1) the impact of foreign ownership on wages and working conditions, (2) whether the relationship between wages and working conditions within these exporting factories more closely resembles efficiency wage or compensating differential theory, and (3) whether the wage-working conditions relationship differs between domestically owned and foreign-owned firms. They find that foreign ownership increases compliance on both wages and working conditions, contradicting the contention that higher wages in foreign-owned firms compensate workers for worse working conditions. In addition, they find that a robust positive relationship between wages and working conditions in the sample as a whole, suggesting that efficiency wages or a similar theory more accurately explains the behavior of these exporting firms than compensating differentials. Working Paper 257 URL: http://www.cgdev.org/content/publications/detail/1425198

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  • Cael Warren & Raymond Robertson, 2011. "Globalization, Wages, and Working Conditions: A Case Study of Cambodian Garment Factories," Working Papers id:4505, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:4505
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    2. World Bank, 2013. "Minimum Wage Policy : Lessons with a Focus on the ASEAN Region," World Bank Publications - Reports 16687, The World Bank Group.
    3. Thomas Bernhardt, 2013. "Developing countries in the global apparel value chain: a tale of upgrading and downgrading experiences," Global Development Institute Working Paper Series ctg-2013-22, GDI, The University of Manchester.
    4. Takaaki Kizu & Stefan Kühn & Christian Viegelahn, 2016. "Jobs in global supply chains: a macroeconomic assessment," FIW Working Paper series 170, FIW.

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