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Industrial labour productivities and tariffs in South Africa


  • Torfinn Harding
  • Jørn Rattsø


The analysis of the effect of tariffs for labour productivity faces the challenge of tariff policy endogeneity. Tariff policy is designed to promote economic development and the industrial sector tariff structure may reflect characteristics of the industries protected. We seek to identify the effect of tariffs by taking advantage of multilateral tariff liberalization using reductions in industrial sector tariffs in other world regions as instruments for sectoral tariff reductions in South Africa. The data cover 28 manufacturing sectors over the period 1988-2003. We find that tariff reductions have stimulated labour productivity when instrumented by multilateral tariffs. The ordinary least-squares estimates show downward bias and this confirms the endogeneity of tariffs. Investigation of channels of effects shows some support for the importance of competitive pressure and technology spillover from trade liberalization. Copyright (c) 2010 The Authors. Journal compilation (c) 2010 The European Bank for Reconstruction and Development.

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  • Torfinn Harding & Jørn Rattsø, 2010. "Industrial labour productivities and tariffs in South Africa," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 18(3), pages 459-485, July.
  • Handle: RePEc:bla:etrans:v:18:y:2010:i:3:p:459-485

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    References listed on IDEAS

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    5. Cavalcanti Ferreira, Pedro & Facchini, Giovanni, 2005. "Trade liberalization and industrial concentration: Evidence from Brazil," The Quarterly Review of Economics and Finance, Elsevier, vol. 45(2-3), pages 432-446, May.
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    7. Pedro Cavalcanti Ferreira & JosÈ Luiz Rossi, 2003. "New Evidence from Brazil on Trade Liberalization and Productivity Growth," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(4), pages 1383-1405, November.
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    11. Philippe Aghion & Johannes Fedderke & Peter Howitt & Chandana Kularatne & Nicola Viegi, 2008. "Testing Creative Destruction in an Opening Economy: the Case of the South African Manufacturing Industries," Working Papers 93, Economic Research Southern Africa.
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    1. repec:pal:compes:v:59:y:2017:i:3:d:10.1057_s41294-017-0030-8 is not listed on IDEAS
    2. Marjan Petreski & Branimir Jovanovic & Igor Velickovski, 2017. "Tariff-Induced (De)industrialization: An Empirical Analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 59(3), pages 345-381, September.

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