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International Trade and Manufacturing Employment: Is India following the Footsteps of Asia or Africa?

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  • Kunal Sen

Abstract

The Indian manufacturing sector has rapidly increased its integration with the world economy since the 1991 trade reforms. We examine whether trade integration created or destroyed jobs in the Indian manufacturing sector, and compare India's employment outcomes with four other countries—Bangladesh, Kenya, South Africa, and Vietnam. We find that the impact of international trade on manufacturing employment seems to be similar to those found for the two African countries rather than the two Asian countries, a surprising result for a country with an apparent comparative advantage in labor‐intensive manufacturing goods, and a large excess supply of unskilled labor.

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  • Kunal Sen, 2009. "International Trade and Manufacturing Employment: Is India following the Footsteps of Asia or Africa?," Review of Development Economics, Wiley Blackwell, vol. 13(4), pages 765-777, November.
    • Handle: RePEc:bla:rdevec:v:13:y:2009:i:4:p:765-777
    DOI: 10.1111/j.1467-9361.2009.00515.x
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    2. Mitchell H. Kellman & Yochanan Shachmurove, 2011. "Herfindahl-Hirschman Meets International Trade and Development Theories," Working Papers 50, Department of Applied Econometrics, Warsaw School of Economics.
    3. Alessandrini, Michele & Fattouh, Bassam & Ferrarini, Benno & Scaramozzino, Pasquale, 2011. "Tariff liberalization and trade specialization: Lessons from India," Journal of Comparative Economics, Elsevier, vol. 39(4), pages 499-513.
    4. Nihar Shembavnekar, 2018. "Did India’s economic reforms generate jobs? Essays on economic liberalisation, labour market flexibility and employment in the Indian manufacturing sector (1990-2006)," Economics PhD Theses 0917, Department of Economics, University of Sussex Business School.
    5. Devasmita Jena & Swati Saini, 2020. "Impact of Trade with ASEAN on India’s Employment in Industrial Sector," Working Papers 2020-190, Madras School of Economics,Chennai,India.
    6. Sakshi Aggarwal & Debashis Chakraborty, 2020. "Labour Market Adjustment and Intra-Industry Trade: Empirical Results from Indian Manufacturing Sectors," Journal of South Asian Development, , vol. 15(2), pages 238-269, August.
    7. Mitchell H. Kellman & Yochanan Shachmurove, 2010. "Adam Smith Meets an Index of Specialization in International Trade," PIER Working Paper Archive 10-029, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    8. Karishma Banga, 2017. "Impact of Linking into Global Value Chains on Indian Employment," Working Papers 1701, Council on Economic Policies.
    9. Kaung Myat Ko & Poomthan Rangkakulnuwat & Sasiwimon W. Paweenawat, 2015. "The Effect of International Trade on Labor Demand in ASEAN5," Economics Bulletin, AccessEcon, vol. 35(2), pages 1034-1041.
    10. Rajesh Raj S.N. & Subash Sasidharan, 2015. "Impact of Foreign Trade on Employment and Wages in Indian Manufacturing," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 16(2), pages 209-232, September.
    11. Tandon, Anjali, 2022. "Employment implications of India’s international trade – A macro view based on Input-Output analysis," MPRA Paper 112778, University Library of Munich, Germany.
    12. Ratna Vadra, 2016. "Creeping tiger: India's presence in Africa," African Journal of Economic and Sustainable Development, Inderscience Enterprises Ltd, vol. 5(1), pages 55-65.
    13. Xavier Cirera & Dirk Willenbockel & Rajith W.D. Lakshman, 2014. "Evidence On The Impact Of Tariff Reductions On Employment In Developing Countries: A Systematic Review," Journal of Economic Surveys, Wiley Blackwell, vol. 28(3), pages 449-471, July.
    14. Ayoki, Milton, 2020. "The employment effects of trade policy reform in Myanmar," MPRA Paper 98090, University Library of Munich, Germany.

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