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The twin effects of globalization

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  • Daveri, Francesco
  • Manasse, Paolo
  • Serra, Danilo

Abstract

Employees of"globalized"firms face a riskier, but potentially more rewarding, menu of labor market outcomes. The authors document this neglected tradeoff 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 hand, they enjoy a more rapid career growth and 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 The World Bank in its series Policy Research Working Paper Series with number 3154.

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Date of creation: 01 Oct 2003
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Handle: RePEc:wbk:wbrwps:3154

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Keywords: Small Scale Enterprise; Environmental Economics&Policies; Microfinance; Labor Policies; Economic Theory&Research; Environmental Economics&Policies; Economic Theory&Research; Microfinance; Private Participation in Infrastructure; Small Scale Enterprise;

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Cited by:
  1. Epifani, Paolo, 2003. "Trade liberalization, firm performance, and labor market outcomes in the developing world : what can we learn from micro-level data?," Policy Research Working Paper Series 3063, The World Bank.
  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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