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The Twin Effects of Globalization

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  • Francesco Daveri
  • Paolo Manasse
  • Danila Serra

Abstract

Employees of "globalized" firms face a riskier, but potentially more rewarding, menu of labor market outcomes. We document this neglected trade-off of globalization for a sample of Indian manufacturing firms. On the one hand, the employees of firms subject to foreign competition face a more uncertain stream of earnings and riskier employment prospects. On the other, they enjoy a more rapid career and/or have more opportunities to train and upgrade their skills. The negative uncertainty costs and the positive incentive effects of globalization are thus twin to each other. Concentrating on just one side of the coin gives a misleading picture of globalization.

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Bibliographic Info

Paper provided by IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University in its series Working Papers with number 240.

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Date of creation: 2003
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Handle: RePEc:igi:igierp:240

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Cited by:
  1. Paolo Epifani, 2002. "Trade Liberalization, Firm Performance and Labor Market Outcomes in the Developing World What Can We Learn From Micro-Level Data?," KITeS Working Papers 138, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Feb 2003.
  2. Erkan Erdem & James Tybout, 2003. "Trade Policy and Industrial Sector Responses: Using Evolutionary Models to Interpret the Evidence," NBER Working Papers 9947, National Bureau of Economic Research, Inc.
  3. Pranab Bardhan, 2006. "Globalization, Inequality, and Poverty," IDB Publications 9126, Inter-American Development Bank.

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