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Labor Market Adjustments after a Large Import Shock: Evidence from the German Clothing Industry and the Multi-Fibre Arrangement

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  • Braakmann, Nils

    (Newcastle University)

  • Wagner, Joachim

    (Leuphana University Lüneburg)

Abstract

This paper considers labor market adjustments following a large import shock in the German clothing industry caused by the phasing out of the Multi-Fibre Arrangement. Using the German shoe industry as a control group and administrative data, we study adjustments on the individual and firm level using difference-in-differences. Our results suggest relatively small increases in unemployment risk and no wage effects on the individual level, despite a 30% increase in plant mortality. Part of the different effects found for plants and individuals can be attributed to the reallocation of workers into other industries and occupations.

Suggested Citation

  • Braakmann, Nils & Wagner, Joachim, 2009. "Labor Market Adjustments after a Large Import Shock: Evidence from the German Clothing Industry and the Multi-Fibre Arrangement," IZA Discussion Papers 4633, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4633
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    Cited by:

    1. Eike Berner & Laura Birg & Dominik Boddin, 2017. "Retailers and Consumers: The Pass-through of Import Price Changes," The World Economy, Wiley Blackwell, vol. 40(7), pages 1314-1344, July.
    2. Nils Braakmann & Alexander Vogel, 2011. "How does economic integration influence employment and wages in border regions? The case of the EU enlargement 2004 and Germany’s eastern border," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(2), pages 303-323, June.
    3. repec:got:cegedp:133 is not listed on IDEAS

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    More about this item

    Keywords

    clothing industry; adjustment; import shock; Germany;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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