Do Trading Partners Matter for Labour Market Inequality? The Malaysian Case
This study examines the differential impact of major bilateral trade flows on labour market inequality for the period 1983 to 2000. The focus is on the key trading partners of Malaysia, which are the Association of the Southeast Asian Nations (ASEAN), the United States of America and Japan. The paper finds that the direction of trade or rather the â€œwhomâ€ aspects of trade matter for inequality trends. There are striking differences on the labour market when export destinations are considered relative to import sources. The results suggest that an expansion in exports to countries that are relatively skilled labour abundant causes greater product market competition, thereby increasing the demand for skilled labour vis-a-vis unskilled labour in the domestic market. Inequality outcomes however do not differ with import source, as there is a general dampening effect of import expansion on the former in the short- and long run. The results clearly do not lend support to the widespread belief that imports from countries that are relatively skilled labour abundant reduce labour market inequality.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- André Sapir, 1999.
"Labour market effects of trade with LDCs in Europe,"
ULB Institutional Repository
2013/8158, ULB -- Universite Libre de Bruxelles.
- Khalid Sekkat & Mathias Dewatripont & André Sapir, 1999. "Labor market effects of trade with LDC's in Europe," ULB Institutional Repository 2013/7378, ULB -- Universite Libre de Bruxelles.
- Branko Milanovic, 2006. "Inequality and Determinants of Earnings in Malaysia, 1984-1997 ," Asian Economic Journal, East Asian Economic Association, vol. 20(2), pages 191-216, 06.
- Prema-chandra Athukorala & Jayant Menon, 1999. "Outward Orientation and Economic Development in Malaysia," The World Economy, Wiley Blackwell, vol. 22(8), pages 1119-1139, November.
- Stephen Machin & John Van Reenen, 1998.
"Technology and changes in skill structure: evidence from seven OECD countries,"
IFS Working Papers
W98/04, Institute for Fiscal Studies.
- Stephen Machin & John Van Reenen, 1998. "Technology And Changes In Skill Structure: Evidence From Seven Oecd Countries," The Quarterly Journal of Economics, MIT Press, vol. 113(4), pages 1215-1244, November.
- Machin, S. & Van Reenen, J., 1997. "Technology and Changes in Skill Structure: Evidence from Seven OECD Countries," Papers 24, Centre for Economic Performance & Institute of Economics.
- Hansson, Par, 2000.
"Relative Demand for Skills in Swedish Manufacturing: Technology or Trade?,"
Review of International Economics,
Wiley Blackwell, vol. 8(3), pages 533-55, August.
- Hansson, Pär, 1999. "Relative Demand for Skills in Swedish Manufacturing: Technology or Trade?," Working Paper Series 152, Trade Union Institute for Economic Research.
- Chen, Been-Lon & Hsu, Mei, 2001. "Time-Series Wage Differential in Taiwan: The Role of International Trade," Review of Development Economics, Wiley Blackwell, vol. 5(2), pages 336-54, June.
- Nina Pavcnik, 2000.
"What Explains Skill Upgrading in Less Developed Countries?,"
NBER Working Papers
7846, National Bureau of Economic Research, Inc.
- Pavcnik, Nina, 2003. "What explains skill upgrading in less developed countries?," Journal of Development Economics, Elsevier, vol. 71(2), pages 311-328, August.
- Greenaway, David & Hine, Robert C. & Wright, Peter, 1999. "An empirical assessment of the impact of trade on employment in the United Kingdom," European Journal of Political Economy, Elsevier, vol. 15(3), pages 485-500, September.
- Robert Anderton & Paul Brenton & Eva Oscarsson, 2002. "What’s trade got to do with it? Relative demand for skills within Swedish manufacturing," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 138(4), pages 629-651, December.
- Robert Z. Lawrence & Carolyn L. Evans, 1996. "Trade and Wages: Insights from the Crystal Ball," NBER Working Papers 5633, National Bureau of Economic Research, Inc.
- Arellano, Manuel & Bond, Stephen, 1991.
"Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations,"
Review of Economic Studies,
Wiley Blackwell, vol. 58(2), pages 277-97, April.
- Tom Doan, . "RATS program to replicate Arellano-Bond 1991 dynamic panel," Statistical Software Components RTZ00169, Boston College Department of Economics.
- Kimura, Fukunari & Ando, Mitsuyo, 2003. "Fragmentation and agglomeration matter: Japanese multinationals in Latin America and East Asia," The North American Journal of Economics and Finance, Elsevier, vol. 14(3), pages 287-317, December.
- Chris Milner & Verena Tandrayen, 2007. "The Impact of Exporting and Export Destination on Manufacturing Wages: Evidence for Sub-Saharan Africa," Review of Development Economics, Wiley Blackwell, vol. 11(1), pages 13-30, 02.
- Balassa, Bela, 1986. "The employment effects of trade in manufactured products between developed and developing countries," Journal of Policy Modeling, Elsevier, vol. 8(3), pages 371-390.
When requesting a correction, please mention this item's handle: RePEc:ags:reapec:50161. 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: (AgEcon Search)
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.