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Winners and losers from a commodities-for-manufactures trade boom

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  • Costa, Francisco
  • Garred, Jason
  • Pessoa, João Paulo

Abstract

A recent boom in commodities-for-manufactures trade between China and other developing countries has led to much concern about the losers from rising import competition in manufacturing, but little attention on the winners from growing Chinese demand for commodities. Using census data for Brazil, we find that local labour markets more affected by Chinese import competition experienced slower growth in manufacturing wages between 2000 and 2010. However, we observe faster wage growth in locations benefiting from rising Chinese commodity demand during the same period.

Suggested Citation

  • Costa, Francisco & Garred, Jason & Pessoa, João Paulo, 2016. "Winners and losers from a commodities-for-manufactures trade boom," Journal of International Economics, Elsevier, vol. 102(C), pages 50-69.
  • Handle: RePEc:eee:inecon:v:102:y:2016:i:c:p:50-69
    DOI: 10.1016/j.jinteco.2016.04.005
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Rafael Dix-Carneiro & Brian K. Kovak, 2015. "Trade Reform and Regional Dynamics: Evidence From 25 Years of Brazilian Matched Employer-Employee Data," Upjohn Working Papers and Journal Articles 15-225, W.E. Upjohn Institute for Employment Research.
    2. Pessoa, João Paulo, 2016. "International competition and labor market adjustment," LSE Research Online Documents on Economics 66426, London School of Economics and Political Science, LSE Library.
    3. Rafael Dix-Carneiro & Brian K. Kovak, 2015. "Trade Reform and Regional Dynamics: Evidence From 25 Years of Brazilian Matched Employer-Employee Data," NBER Working Papers 20908, National Bureau of Economic Research, Inc.
    4. Fernandez Sierra, Manuel & Messina, Julián, 2017. "Skill Premium, Labor Supply and Changes in the Structure of Wages in Latin America," IZA Discussion Papers 10718, Institute for the Study of Labor (IZA).
    5. Majlesi, Kaveh & Narciso, Gaia, 2015. "International Import Competition and the Decision to Migrate: Evidence from Mexico," Working Papers 2015:25, Lund University, Department of Economics.
    6. Alexander Murray, 2017. "The Effect of Import Competition on Employment in Canada: Evidence from the 'China Shock'," CSLS Research Reports 2017-03, Centre for the Study of Living Standards.
    7. Dix Carneiro,Rafael & Kovak,Brian K., 2015. "Trade reform and regional dynamics : evidence from 25 years of Brazilian matched employer-employee data," Policy Research Working Paper Series 7205, The World Bank.
    8. Sergio Urzua & Felipe Saffie & Felipe Benguria, 2017. "Demand Shocks and Labor Market Dynamics: Firm Level Responses to a Commodity Boom," 2017 Meeting Papers 1443, Society for Economic Dynamics.
    9. David H. Autor & David Dorn & Gordon H. Hanson, 2016. "The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade," Annual Review of Economics, Annual Reviews, vol. 8(1), pages 205-240, October.
    10. Pavcnik, Nina, 2017. "The Impact of Trade on Inequality in Developing Countries," CEPR Discussion Papers 12331, C.E.P.R. Discussion Papers.
    11. Robert C. Feenstra & Hong Ma & Yuan Xu, 2017. "US Exports and Employment," NBER Working Papers 24056, National Bureau of Economic Research, Inc.
    12. Rafael Dix-Carneiro & Brian K. Kovak, 2015. "Trade Liberalization and the Skill Premium: A Local Labor Markets Approach," NBER Working Papers 20912, National Bureau of Economic Research, Inc.
    13. Gordon H. Hanson, 2017. "What Do We Really Know about Offshoring? Industries and Countries in Global Production Sharing," Development Working Papers 416, Centro Studi Luca d'Agliano, University of Milano, revised 21 Feb 2017.
    14. Nina Pavcnik, 2017. "The Impact of Trade on Inequality in Developing Countries," NBER Working Papers 23878, National Bureau of Economic Research, Inc.
    15. Roberto Álvarez & Álvaro García Marín & Sebastián Ilabaca, 2017. "Commodity Prices Shocks and Poverty Reduction in Chile," Working Papers wp449, University of Chile, Department of Economics.
    16. Rafael Dix-Carneiro & Brian K Kovak, 2016. "Trade Liberalization and Regional Dynamics," Working Papers id:11213, eSocialSciences.
    17. Fernandez Sierra, Manuel & Messina, Julián, 2017. "Skill Premium, Labor Supply and Changes in the Structure of Wages in Latin America," IZA Discussion Papers 10718, Institute for the Study of Labor (IZA).
    18. Dix-Carneiro, Rafael & Soares, Rodrigo R. & Ulysse, Gabriel, 2017. "Economic Shocks and Crime: Evidence from the Brazilian Trade Liberalization," GLO Discussion Paper Series 3, Global Labor Organization (GLO).
    19. repec:eee:eecrev:v:101:y:2018:i:c:p:479-504 is not listed on IDEAS
    20. Roberto Alvarez & Damián Vergara, 2016. "Natural Resources and Education: Evidence from Chile," Working Papers wp433, University of Chile, Department of Economics.
    21. Rafael Dix-Carneiro & Brian K. Kovak, 2017. "Margins of Labor Market Adjustment to Trade," NBER Working Papers 23595, National Bureau of Economic Research, Inc.
    22. Dix-Carneiro, Rafael & Soares, Rodrigo R. & Ulyssea, Gabriel, 2016. "Local Labor Market Conditions and Crime: Evidence from the Brazilian Trade Liberalization," IZA Discussion Papers 9638, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    Trade; China; Brazil; Commodities; Labour markets; Informality;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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